Consolidated Accounts

Transcription

Annual
Report and
Accounts
2015
CHAIR M AN’S LE T TER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
BOARD ME MBER S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ORG ANIZ ATIONAL CHART . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
WORLDWIDE PRE SENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
01
SIGnIFIC ANT EVENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
02
CONSOLIDATED M ANAGE MENT REP ORt . . . . . . . . . . . . . . . . . . . . 18
03
CORP OR ATE GOVERNANCE REP ORT . . . . . . . . . . . . . . . . .. . . . . . . 58
04
CONSOLIDATED FINANCIAL STATE MENTs . . . . . . . . . . . . . . . . . . . 98
05
NOTE S TO THE CONSOLIDATED FINANCIAL STATE MENTS . . . . . . 104
06
LEG AL OPINION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
INDEX —
3
Chairman’s
message
World economic growth slowed somewhat surprisingly in 2015 to an annual rate of just over
3%. In spite of this deceleration, Corticeira Amorim’s most important markets all registered
positive, albeit relatively modest, growth.
The US, Corticeira Amorim’s single most important market, enjoyed its sixth consecutive year
of growth, expanding at a significantly faster rate than the European Union, where most of
the Group’s other important markets are located. On the negative side, the Russian economy
performed poorly, a contraction aggravated by the economic sanctions imposed on the
country. This impacted strongly on our sales to the Russian market, hitting the Cork Stopper,
Composite Cork and Floor and Wall Coverings Business Units (BU) the hardest.
Total sales exceeded €600 million for the first time on record, reaching €604.8 million, an
increase of 7.9% on 2014. Of the €44 million increase in sales, about half was estimated to have
resulted from the impact of the favourable EUR/USD exchange rate. Except for Floor and Wall
Coverings, all our BU increased their sales in 2015, with Cork Stoppers (+9.9%) and Composite
Cork (+17%) performing particularly well.
A strong operating performance saw EBITDA exceed €100 million for the first time thanks to
an increase of 16.1%. The EBITDA/sales ratio rose to 16.7%, a considerable improvement on
the 15.5% registered in 2014.
Reductions in remunerated debt and the average interest rate paid by the Group led to a
significant improvement in the level of financial autonomy, which rose from 51.1% in December
2014 to 53.1% at the end of 2015.
In line with sales and EBITDA, Corticeira Amorim’s net profit also passed a significant milestone,
exceeding €50 million for the first time following an increase of 53.9% on 2014 to a total of
€55 million.
4
— ANNUAL REP ORT AND ACCOUNTS ‘15 CORT iCEiR A A mORim , S.g.P.S., S. a .
In a significant financial operation at the end of the third quarter, Corticeira Amorim sold
all the own shares it held, increasing its free float to about 15%. The impact on liquidity was
immediate with the average daily volume of share trades increasing significantly. The transaction
also increased the likelihood of the Group’s shares being included in Portugal’s PSI 20 stock
market index.
Thanks to our positive financial position, strengthened by the funds raised from the sale of
our own shares, Corticeira Amorim was able to distribute more than €50 million in dividends,
the equivalent of €0.385 per share.
Indeed, 2015 was a landmark year for Corticeira Amorim during which our business activities
expanded significantly. This strong performance resulted from a clear business vision, a strategy
designed to achieve growth and create value, and the dedicated work, professionalism and
commitment of all the Group’s employees.
The year of 2016 will bring many challenges. We are conscious, however, of the quality and
uniqueness our products, which markets recognise and value. Our innumerable and continuous
research, development and innovation initiatives add the benefit of innovative products and
unmatchable technical performance to our sales portfolios. We are constantly introducing
measures to improve our operating efficiency at every level and the results we have already
achieved inspire our teams to better them. For all these reasons, we face the future with
confidence and determination.
I would like to conclude by expressing, on behalf of myself and the Board of Directors of
Corticeira Amorim, our sincere thanks to our customers for their continued support; to our
staff for their commitment, professionalism and enthusiasm; to our suppliers for strengthening
existing partnerships; and to the shareholders of Corticeira Amorim for the trust they place
in our team.
Cordially,
António Rios de Amorim
CHAIR M AN’S LE T TER —
5
Cork Oak Forest
6
BOarD memBers
BOARD OF DIREC TOR S
António Rios Amorim
Chairman
Nuno Filipe Vilela Barroca de Oliveira
Vice-Chairman
Fernando José de Araújo dos Santos Almeida
Member
Cristina Rios de Amorim Baptista
Member
Luísa Alexandra Ramos Amorim
Member
Juan Ginesta Viñas
Member
BOARD OF THE GENERAL MEE TING
Augusto Fernando Correia de Aguiar-Branco
Chairman
Rita Jorge Rocha e Silva
Secretary
SUPERVISORY BOARD
Manuel Carvalho Fernandes
Chairman
Ana Paula Africano de Sousa e Silva
Member
Eugénio Luís Lopes Franco Ferreira
Member
Durval Ferreira Marques
Substitute Member
STAT UTORY AUDITOR
Pricewaterhousecoopers & Associados – Sociedade de Revisores Oficiais de Contas, Lda,
represented by António Joaquim Brochado Correia (ROC) or by José Pereira Alves (ROC)
Auditor
Hermínio António Paulos Afonso (ROC)
Substitute
As of December 31, 2015
BOARD ME MBER S —
7
OrganiZaTiOnaL CharT
RAW MATERIALS
CORK STOPPERS
R&D, INNOVATION
Amorim Florestal, S.A.
Amorim & Irmãos, S.G.P.S., S.A.
Provision
Production
Distribution
Ponte de Sôr – Portugal
Amorim & Irmãos, S.A.
Santa Maria de Lamas – Portugal
Ind. Unit Distribuição
Amorim Cork Research, Lda.
Mozelos – Portugal
Coruche – Portugal
Trefinos Australia, Pty Ltd
Adelaide – Australia
Amorim Cork Services, Lda.
Amorim Australasia
Amorim Cork Ventures, Lda.
Amorim Florestal Mediterrâneo, S.L. San Vicente de Alcántara – Spain
Amorim & Irmãos, S.A
Ind. Unit Top Series
Vergada – Portugal
Ind. Unit Valada
Valada – Portugal
Ind. Unit Coruche
Coruche – Portugal
Ind. Unit Champanhe
Ind. Unit Portocork
Ind. Unit Salteiros
Amorim Cork America, Inc.
Napa Valley, CA – USA
Comatral – Compagnie Marocaine de
Transformation du Liège, S.A. Skhirat –
Morocco
Francisco Oller, S.A.
Girona – Spain
ACIC – USA LLC
S.N.L. – Societé Nouvelle du Liège, S.A.
Tabarka – Tunisia
Trefinos, S.L.
Girona – Spain
Amorim France, S.A.S.
Eysines, Bordeaux – France
Abrantes – Portugal
Ind. Unit Salteiros
Amorim Florestal España, S.L
Algeciras – Spain
Amorim Florestal España, S.L.
San Vicente de Alcántara – Spain
S.I.B.L. – S.A.R.L.
Jijel – Algeria
Augusta Cork, S.L.
Amorim Cork Italia, S.p.A.
Conegliano – Italy
Amorim Cork Deutschland, GmbH
Bingen am Rhein – Germany
Amorim Cork Bulgaria, EOOD
Sofia – Bulgaria
Amorim France S.A.S.
Ind. Unit Sobefi
Cognac – France
Amorim France S.A.S.
Ind. Unit Champfleury
Champfleury – France
Victor y Amorim, S.L.
Navarrete (La Rioja) – Spain
Amorim Cork España S.L.
Hungarokork Amorim, Rt.
Veresegyház – Hungary
Korken Schiesser, GmbH
Vienna – Austria
Portocork America, Inc.
Amorim Cork South Africa (PTY) Ltd.
Cape Town – South Africa
Corchera Gomez Barris, SA
Santiago – Chile
Wine Packaging & Logistic, SA
Santiago – Chile
Industria Corchera, S.A.
Santiago – Chile
Société Nouvelle des Bouchons
Trescasses, S.A.
Le Boulou – France
I.M. «Moldamorim», S.A.
Chisinau – Moldávia
Amorim Cork Beijing, Ltd.
Beijing – China
S.A. Oller et Cie
Reims – France
Corchos de Argentina, S.A.
Mendoza – Argentina
Agglotap S.A.
Girona – Spain
Sagrera et Cie
Reims – France
Trefinos Italia SRL
Treviso – Italy
Trefinos USA
Fairfield, CA – USA
Trefinos Australia
Bouchons Prioux S.A.R.L.
Epernay – France
8
COMPOSITE CORK
Amorim Cork Composites, S.A.
FLOOR AND WALL COVERINGS
Amorim Revestimentos, S.A.
INSULATION CORK
Amorim Isolamentos, S.A.
Production
Distribution
Distribution
S. Paio de Oleiros – Portugal
Amorim Benelux B.V.
Tholen – Netherlands
Amorim Industrial Solutions Imobiliária,
S.A.
Corroios – Portugal
Lourosa – Portugal
Amorim Deutschland GmbH & Co. KG
Delmenhorst – Germany
Silves – Portugal
Corticeira Amorim France, S.A.S.
Lavardac – France
Amorim Flooring Austria GmbH
Vienna – Austria
Vendas Novas – Portugal
Amorlink – Noise & Vibration Control, Ltd
Istanbul – Turkey
Amorim Flooring (Switzerland) AG
Zug – Switzerland
Chinamate (Xi’an) Natural
Products Co. Ltd.
Xi’an – China
Amorim Revestimientos, S.A.
Barcelona – Spain
Amosealtex Cork Co., Ltd
Shanghai – China
Dom Korkowy, Sp. Zo.o
Krakow – Poland
Amorim Cork Composites, Inc.
Trevor, WI – USA
Amorim Flooring North America
Hanover, MD – USA
Amorim (UK) Limited
West Sussex – United Kingdom
Cortex Korkvertriebs GmbH
Nürnberg – Germany
US Floors Inc.
Dalton, GA – USA
Timberman Denmark A/S
Hadsund – Denmark
ORG ANIZ ATIONAL CHART —
9
Worldwide
Presence
11
Industrial Plants
Raw Material
18
Industrial Plants
Cork Solutions
44
1
Distribution
Companies
11
Joint Ventures
258
Main Agents
Japan
Italy
Israel
India
Iceland
Hungary
Hong Kong
Greece
Germany
Georgia
France
Finland
Estonia
Egypt
Dominicana Republic
Denmark
Czech Republic
Croatia
Crimea
Costa Rica
China
Chile
Cape Verde
Canada
Bulgary
Brazil
Bosnia
Belgium
Azerbaijan
Austria
Argentina
1
1
Distribution Companies
1
Joint Ventures
1
10
2
1
IP Cork Solutions
Main Agents
Australia
IP Raw Material
Algeria
Countries
Angola
1
1
4
4
1
1
9
1
6
1
1
1
2
1
1
9
2
1
1
1
4
1
1
1
3
1
1
2
2 24
3
1 29
3
1
1
1
2
1
3
1
6
4
1
2
1
1
1
2
1
1
3
1
1
1
1
2
1
1
1
2
1
1
1 16
5
8
2
1
1
3
1
2
1
1
5
3
14
2
2 12 19
4
1
2 10
1
1
1
1
4
6
1
1
1
7
1
3 10
WORLDWIDE PRE SENCE —
11
7
Vietnam
USA
1
United Kingdom
United Arab Emirates
Industrial Plants
Raw Material
Ukraine
Turkey
Tunisia
Thailand
Syria
Switzerland
Sweden
Sri Lanka
Spain
South Korea
South Africa
Slovenia
Singapore
Serbia , Macedonia , Montenegro
Scotland
Saudi Arabia
Russia
Portugal
Poland
Philippines
Peru
Pakistan
Norway
Netherlands
Mozambique
Morocco
Mongolia
Moldavia
Mexico
Malta
Lithuania , Estonia and Latvia
Lebanon
Latvia
Kyrgyzstan
Kuwait
Kazakhstan
Jordan
Geographic Location
Industrial Plants
Cork Solutions
5
14
2
3
1
1
1
1
1
Singificant
Events
01
singiFiCanT
eVenTs
February
Corkcomfort collection chosen for the new K Art Gallery, in New
York. The renovation of the space, which takes the form of an open
white cube, was overseen by the distinguished New York design studio
Leong Leong and includes the installation of an Originals Dawn floor,
from the Corkcomfort collection, which is distinguished by the natural
and genuine look of natural cork. One of the main objectives of K Art
Gallery is to highlight how different presentation contexts mediate
the reception of art.
January
Corticeira Amorim launches Hydrocork, by Wicanders, an innovative
water-proof floating floor, with a thickness of only 4 mm and all the
benefits of a cork floor (CorkTech technology), particularly in terms
of comfort, body wellness, shock absorption and thermal and acoustic
insulation. Hydrocork, designed by the Flooring Business Unit, and
presented at BAU (Germany), results from the strategic commitment
of Corticeira Amorim to R&D and Innovation.
Amorim Cork Ventures issues 1st Call for entrepreneurs with ideas,
applications or innovative business proposals for the cork sector. The
initiative included a capacity building programme for entrepreneurs,
in partnership with Gestluz. After the screening phase, entrepreneurs
benefited from a process to develop expertise and those selected had
access to the Corticeira Amorim incubator.
March
Cavaco Silva and Assunção Cristas visit Corticeira Amorim. In one
day dedicated to Portuguese Forests, the President of the Portuguese
Republic and the Minister of Agriculture and the Sea visited the
Industrial Unit in Ponte de Sôr. The day’s activities highlighted the
economic importance of the three main forestry sectors – cork oak,
eucalyptus and maritime pine. In addition to their unquestionable and
recognized value in environmental terms, Portugal’s forests and the
companies operating in the forestry sector are extremely important
in the Portuguese economy, contributing with about 10% of the
country’s exports. In social terms, the forestry sector is estimated
to directly employ around 135,000 workers and involves around
400,000 landowners.
April
Corticeira Amorim partner of several initiatives at Milan Design
Week 2015, ensuring that cork remained in the spotlight for the 5th
consecutive year in the world’s biggest design event: Lunch Box - a
project to create cork lunchboxes in partnership with the New Academy
of Fine Arts in Milan, NABA, one of the world’s most charismatic design
universities; Exit - a modular system of wall or floor coatings, developed
by StudioIrvine for MatteoBrioni, combining natural materials like cork,
terracotta and marble with raw earth; Exhibition paying tribute to
James Irvine - with two projects that the renowned designer developed
for Corticeira Amorim (Six, of the MATERIA collection, and Stow It, of
the Metamorphosis project).
Corticeira Amorim’s volunteers plant 2700 cork oak in a burnt area
in Peneda Mountain (Portugal). The purpose of planting Portuguese
native trees in this area is to create a natural barrier against forest
fires in Peneda Mountain, near the Peneda-Gerês National Park. This
initiative of the municipality of Melgaço had the support of Quercus’
Common Forest Project, ICNF, ANMP and UTAD, with the special support
of ESB-UCP. Several employees of Corticeira Amorim volunteered for
this tree-planting initiative.
NH hotel chain recycles 2 tons of cork stoppers. Conducted in
partnership with Corticeira Amorim, Cork2Cork is a unique recycling
programme that turns cork stoppers into flooring for the prestigious
NH international hotel chain. The NH Hotels Group collected 1994 kg
of cork stoppers in their 77 hotel units, located in Spain, Italy, Germany,
France, Belgium and Holland. After being recycled in a pioneering
initiative in the industry, the cork stoppers were transformed into new
flooring used in the renovation of the hotel units. Since its launch,
the recycling of cork stoppers has already produced about 8000 m²
of flooring, equivalent to that used in renovation or construction of
more than 300 rooms.
14
The Helix packaging system won the Best Green Launch award at
the 2015 edition of the Drinks Business Green Awards, in London.
The event took place in one of the most prestigious spots in London,
the Ivy Restaurant, where Patrick Schmitt, Drinks Business editor,
highlighted the unprecedented nature of the solution: “The appeal
of Helix is based on its convenience and ease of opening, but at the
same time because it continues to offer the sustainability credentials
of cork.” This important recognition adds to the various awards that
Helix has won since its launch at Vinexpo in 2013, including the “Oscar
of Packaging”, in France and Italy.
The Fabrica research and communication centre, a member of the
Benetton Group, designed a line of cork furniture for Expo Milan
2015. Under the theme “You make the Park”, the proposal’s main
materials are cork, Galestro terracotta and wood. Corticeira Amorim
was a partner of this project from its conception, with an active role
in providing technical advice and the cork required for the entire
collection. Developed in close connection with the Expo’s theme, this
line of sustainable furniture evokes the concept of “what comes from
the earth, returns to the earth”, supporting the use of materials that
are 100% natural and recyclable, wherein cork is the finest example.
May
During the Fourth Mediterranean Forest Week, held in Barcelona,
Corticeira Amorim was awarded the Forestry Bioeconomy Prize,
in recognition of its role in the protection and development of the
most important forest species of this geographical area, the cork
oak. The prize was awarded by the European Forest Institute and by
the Generalitat of Catalonia, with the collaboration of the Forestry
Directorate-Generals of the Mediterranean area.
Portuguese cork at the Holy Shroud exhibition, in Italy. The expanded
insulation corkboard played a key role in the construction of the new
prayer building for pilgrims at the Holy Shroud exhibition, in Italy.
Built near Turin Cathedral and named Penitenzieri, this building uses
expanded insulation corkboard for technical thermal and acoustical
insulation as well as on its façade, as the result of a collaboration with
Amorim Isolamentos, through its Italian distributor, Tecnosugheri. The
building, through which about 4 million pilgrims passed, was open to
the public until 24 June.
Towada Community Plaza of Kengo Kuma, with Wicanders flooring.
The work, a warm and convivial space for children and adults, was
designed based on the architectural features of the city and in terms
of comfort and thermal and acoustic insulation, benefits from the
application of a Wicanders Corkcomfort glue down HPS floor, of the
Nuances reference. Kengo Kuma, admired worldwide for combining
tradition and modernity, states that: “The cork floor will have a
promising future in Japan. When people realize the credentials of
thermal insulation and how easy it is to maintain the equipment, they
will start to use it more.”
July
Corticeira Amorim and Mercedes-Benz Portugal again joined forces
to jointly initiate the development of new cork boards for the
Hawaiian surfer Garrett McNamara. The goal is, in the short term,
to develop new models of tow-in boards especially designed to meet
the characteristics of the waves of Nazaré. A few months after having
initiated the development of cork boards for Garrett McNamara, the
Hawaiian surfer guarantees he has found the ideal material that will
soon allow him to face the fury of the waves of Nazaré.
Santa Bárbara Eco-Beach Resort is the first hotel in the Azores
covered with cork. Located at Santa Bárbara beach, in S. Miguel,
and developed by the architectural firm M-Arquitectos, this new
hotel unit was designed based on three key pillars: landscape design,
respect for nature and integration. This is the context for the choice
of MDFachada expanded insulation corkboard of Amorim Isolamentos
which, besides being a material that is 100% natural, durable and
an excellent performer in terms of thermal insulation, enables full
integration into the surrounding environment.
June
Brazilian Pavilion at Expo Milan 2015 covered with cork. The pavilion
stands out due to its unconventional design, in which the architectural
and scenographic elements appear to be intimately connected. With
the Brazilian Pavilion the tradition of the use of MD Fachada expanded
insulation corkboard on the façades of the buildings during major
international expositions is renewed. 140 countries participated in
the Milan Expo, on the theme “Feeding the Planet, Energy for Life”,
which had about 20 million visitors.
Corticeira Amorim offers free technical advisory service for forestry
producers. The service, launched in 2008, was created with the objective
of identifying and promoting the adoption of best forest management
practices for the cork oak forests and associated biodiversity. So far,
the technical advisory service has encompassed over 20,000 hectares
of forest area of cork oak. This year, an evaluation of the plant health
of oak trees has been introduced for the first time.
September
Amorim Cork Ventures launches 2nd Call. Lisbon was chosen for
the second capacity-building programme of Amorim Cork Ventures,
Corticeira Amorim’s business incubator that, created about a year ago,
has already received more than 190 applications. The holding of the
capacity building programme in the Portuguese capital, this time in
partnership with Beta-i, aimed at facilitating the access of entrepreneurs
with ideas, applications or innovative business proposals for the cork
sector, thus preventing missed opportunities due to geographical
constraints related to their location.
SINGIFIC ANT EVENTS —
15
Amorim Isolamentos exhibits the new WAVE FACADE collection at
Concreta (Porto). WAVE FACADE takes advantage of the characteristics
of expanded insulation corkboard - excellent thermal and acoustic
insulation, durability and extreme versatility – to form a wall covering
solution that combines design and technical performance and is suitable
for both building interiors and exteriors. The WAVE FACADE 2015/2016
collection, which unfolds in numerous visual aspects, is designed by
the architect José Pedro Sousa (FAUP/DFL).
Hydrocork, of Wicanders, won a Green Dot Award in the “New
Green Product” category, at the 16th Archivex, an international
architecture, interior design and construction exhibition, held in
Malaysia. Hydrocork was among the four winners from a total of 50
products nominated for this category. It thus received this “green seal
of quality”, which attests to its sustainability.
December
Amorim Isolamentos supports the creation of Sala A+ which
simulates a visit to Torre dos Clérigos. Opened on the International
Day of People with Disabilities, this new space of the city of Porto aims
to improve the experience of people with limited autonomy. Amorim
Isolamentos supported, to this end, the creation of a semi-circular
cork capsule, installed in the museum of the Torre dos Clérigos. It is
a multisensory perception station that simulates a visit to the top of
this historic and emblematic building of the city of Porto. It makes it
possible to observe the panoramic views in real time, something that
so far could only been achieved by ascending to the Tower.
Volunteers of Corticeira Amorim plant about 2,500 native trees on
the perimeter of PERM, in Santa Maria da Feira. This was the first
afforestation initiative that took place in Santa Maria da Feira, which
is where the cork industry is predominantly based. It was also made
feasible by the Common Forest Project of Quercus. PERM was designed
with the purpose of encouraging the concentration of companies
engaged in the recovery and recycling of materials, ensuring their
treatment respecting the environment. In perfect harmony with this
environmental motivation, Santa Maria da Feira Municipal Council
challenged Corticeira Amorim to be an active part of a local forestry
initiative, with the planting of 2425 trees.
The innovative Helix wine packaging, developed by Corticeira
Amorim and Owens-Illinois, was officially launched in South
Africa. The presentation took place at Cape Wine 2015, a renowned
symposium that brings together representatives of wine, business and
lifestyle publications of reference, as well as different personalities of
the area. They were eager to learn more about this new easy opening
system, which keeps the cork and glass relationship and combines it
with quality, sustainability and premium image.
Amorim Flooring presents the Novel Symmetries collection, of
Wicanders. This collection was developed by the renowned Italian
designer Antonio Bullo, which conveys the main current trends of
interior design in the cork floors. The new collection, with a concept
that refers to the combination of “Nature and Geometry”, is designed
for contemporary environments, providing warmth and comfort
offered by a natural material such as cork, an advantage over other
typically “cold” materials.
Wicanders cork flooring, of Amorim Flooring takes the lead role in
the mosaic with bronze inlay, created by the prestigious Portuguese
artist Leonor Antunes for her solo exhibition at the Bordeaux
Museum of Contemporary Art - CAPC. It is an installation that
blends perfectly with the iconic space of the museum’s central nave
and the sculptures developed by the artist for this purpose, in order
to give it new luminosity. The cork mosaic, covers an area of 1500 m2
and occupies the entire floor of the central nave of the CAPC. It was
developed from the Wicanders Corkcomfort range, a product line
that promotes not only the comfort of cork but also its typical look.
November
Home of Jasper Morrison for Muji covered with cork. The renowned
designer, answering the challenge of the iconic Japanese brand Muji,
selected the MD Fachada expanded insulation corkboard of Amorim
Isolamentos for the facade of the building. This material, in addition
to its sustainability characteristics, is an excellent thermal and acoustic
insulation. Naoto Fukasawa (JP) and Konstantin Grcic (AL) were the
designers who joined forces with Jasper Morrison and, under the slogan
“A Rich Life Through Minimalism”, presented models of temporary
homes. The different models presented have prices between 25,000
and 40,000 dollars, and will be soon available for purchase.
Amorim Flooring presents the Collaborative Innovation and Applied
Research Centre. With a covered area of 1000 m² and a total area of
1200 m², this space will be an important vehicle for showcasing Corktech
technology – which enhances the characteristics of cork through the use
of cutting edge technology – a distinctive element that makes Amorim
Flooring coverings stand out from all the other solutions available in the
market, a differentiation that results from the incorporation of cork.
16
Collaborative Innovation and Applied Research Centre
SINGIFIC ANT EVENTS —
17
Consolidated
Management
Report
02
1
MACROECONOMIC
TRENDS IN 2015
1.1. Global Overview
Surprisingly, the rate of global economic growth in 2015, estimated
at about 3.1%, was lower than in the previous year. Business activity
remained depressed. Growth decelerated in emerging countries for
the fifth consecutive year to about 4%, the lowest level since the
2008-09 financial crisis, while developed economies expanded at
a faster rate, consolidating a diverging pattern of growth. Although
the US Federal Reserve began normalising US dollar interest rates in
December with its first rate increase since 2006, monetary policy was
globally accommodating, while fiscal policy was less restrictive. The
divergence between the monetary policy of the US (and the UK) and
that of other developed economies dominated the evolution of financial
markets, affecting the economic performance of several emerging
economies. Nevertheless, the prevailing outlook for a gradual increase
in US reference interest rates, together with episodes of increased
volatility triggered by concern over the impact of that increase on
the growth of emerging economies, resulted in more restrictive
financial conditions at a global level and an acceleration in capital
outflows from emerging economies. The economic climate in 2015
was characterised by an unfavourable evolution of commodity prices,
a slowdown in industrial activity and a fall in world trade indicators,
especially at the end of the year. The outlook was also affected by a
change in China’s growth pattern related to the above factors, as the
Chinese authorities sought to rebalance growth in favour of services
and domestic demand to achieve more balanced growth. The general
trend over the year was for the US dollar to strengthen.
The Euro Zone expanded faster than in 2014, achieving an annual
growth rate of about 1.5%, below initial expectations. Domestic demand
recovered, compensating for a reduced contribution to growth from
net exports and benefitting from extremely favourable financing
conditions over a sustained period (resulting from an expansion of
quantitative easing measures), falling oil prices and globally neutral
fiscal policies. The slowdown in China and other emerging economies,
as well as a persistently high level of private sector debt, hampered
economic recovery. Unemployment fell gradually, from 11.5% at the
beginning of the year to 10.4% at the end, with significant disparities
between member states continuing. In spite of monetary stimulus
measures, inflation oscillated close to a marginally positive level,
moving further away from the mandatory European Central Bank
(ECB) target than in 2014.
The US economy is estimated to have grown at a rate of about 2.5% in
2015, marginally higher than in the previous year. The sixth consecutive
year of growth for the world’s largest economy reflected the strong
performance of the real estate sector as well as growth in segments
such as automobile sales and credit and improved labour market
conditions – the unemployment rate reached a historic low of 5%
in December. However, the fall in oil prices had a significant impact
on investment in the gas and crude oil extraction sector, penalising
aggregate domestic demand, especially at the end of the year. Activity
in the industrial sector decelerated, affected by the slowdown in world
growth and a stronger US dollar.
20
- ANNUAL REP ORT AND ACCOUNTS ‘15 CORTiCEiR A A mORim , S.g.P.S., S. a .
Japan grew at an estimated rate of close to 0.6%, faster than in 2014.
In response to signs of a slowdown in China and the rest of Asia, one
of the country’s leading export markets, the Japanese authorities
adopted non-orthodox monetary measures in an effort to support
the economy.
The UK economy expanded at a rate of about 2.2% in 2015, down from
2.9% in 2014. Growth is likely to have been penalised by expectations
of a referendum on the country’s membership of the European Union
and uncertainty over the outcome of the vote.
Economic growth in Australia decelerated to a rate of 2.4%.
Developing and emerging economies saw their growth rate slow
further to about 4%.
China moved forward with the strategy it began in 2013 to bring about a
structural change in its pattern of economic growth. Its annual growth
rate in 2015 is estimated at about 6.9%, marked by a slowdown in the
second half of the year. India grew by around 7.3%, about the same
rate as in 2014. Brazil and Russia both saw their economies contract
by about 4%. South Africa expanded at a slower pace than in 2014,
growing at a rate of approximately 1.3%.
As in 2014, global monetary policy was marked by a divergence between
the US Federal Reserve, on one hand, and the central banks of the other
leading developed economies on the other. Overall, monetary policy
was characterised by the continuation of an extremely accommodating
approach, with the exception of some emerging economies, which,
struggling with inflation and increasingly large currency devaluations,
opted for tough restrictive measures. The ECB and the Bank of Japan
introduced additional non-orthodox measures and, in Europe, the
monetary authority cut rates to historically low levels, even introducing
negative reference rates for the absorption of excess liquidity. Oil prices
continued to fall as they had done the previous year, dropping at an
even faster rate from September 2015 onwards. The fact that Saudi
Arabia, the effective leader of the Organisation of Petroleum Exporting
Countries (OPEC), persisted with its policy of maintaining production
levels, in spite of a generalised excess of supply and expectations of
production increases by countries such as Iran, aggravated the fall in
prices, leading to renewed expectations of global deflationary pressures.
Inflation decelerated in developed economies to levels below their
official targets, while inflation rates in emerging economies varied
depending on the balance between currency devaluations on one side
and both falling commodity prices and the impact of demand on the
other, especially in countries with larger external imbalances. In some
emerging economies – Brazil being the best example – the need to
respond to further currency depreciations and/or sharp increases in
inflation led to continued interest rates increases.
CORK OAK FORE ST
1.2. P ort ug al
In 2015, Portugal recorded its second consecutive year of growth
following a prolonged recession. The economy is estimated to have
expanded at a rate of about 1.6%, marginally higher than average annual
growth since the country joined the Euro in 1999. In these two years
of growth, however, the Portuguese economy recovered only a third
of the value destroyed during the crisis. The increase in economic
activity was driven, in a way that had not been fully anticipated, but
which resulted from the trends observed at the end of 2014, by the
growth of domestic demand (especially investment) and, marginally,
by an increase in net export demand (reflecting excellent export
performance). Nevertheless, the contribution was lower than in the
previous year, due to the strong impact on imports of investment in
working capital. After four years of contraction, public consumption
made a positive contribution to growth in 2015. Growth was stronger
in the first half of the year, but decelerated in the third and fourth
quarters, a development probably linked to the period of increased
political uncertainty that the country experienced at that time. The
worsening international outlook, evident in China and the US, but
also in countries like Angola and Brazil, also had an impact on the
contribution of net external demand to growth. On the positive side,
a favourable drop in imported energy costs and the ECB’s monetary
policy supported the recovery.
Efforts to consolidate the public accounts continued, albeit at a more
moderate pace, and Portugal remained subject to analysis under the
European Commission’s Excessive Deficit Procedure. A period of
political uncertainty beginning in September raised concerns over
a potential pause in the consolidation process. The budget deficit is
estimated to have decreased to 3% of GDP in 2015 (excluding state
interventions in the financial sector) with fiscal revenue increasing by
about 5% to a new record. However, the structural deficit widened.
The current account continued to improve, resulting in a surplus of
more than 0.6% of GDP. Portugal also continued to diversify its export
markets. Net external financing requirements were in surplus for the
fourth consecutive year, a surplus that in 2015 reached 1.4% of GDP.
In short, Portugal achieved growth in a context of external balance.
Unemployment trends produced a positive surprise, dropping throughout
the year to an average annual rate of 12.6% and reaching 12.2% at the
end of year. This compares with levels above 16% at the worst point
of the crisis. Inflation remained positive, but at a lower level than in
the previous year, at about 0.6%. However, Portuguese inflation was
above the Euro Zone average.
CONSOLiDATED m ANAgE mENT REP ORT —
21
CORK OAK HARVE ST ING
22
2
OPERATING
ACTIVITIES BY
BUSINESS UNIT (BU)
The companies that make up the Corticeira Amorim universe are
structured into Business Units (BU). This report sets out their most
important activities and developments in 2015.
2.1. Raw Material s
Sales by the Raw Materials BU reached €135.54 million, an increase of
3.1% on 2014. EBITDA dropped 2.9% compared with the previous year
to €17 million. The drop in EBITDA was mainly related to the 2014 cork
purchasing campaign, which, because it was smaller placed greater
pressure on purchase prices that year.
The 2015 campaign progressed normally in the Iberian peninsula, enabling
the Raw Materials BU to restore stocks to level that will allow the BU
to maintain the same level of activity in 2016 as in the previous year
and to recover from the impact of the more limited campaign of 2014.
Sales and profitability were affected by a sharp fall in sales to the Floor
and Wall Coverings BU, in terms of both natural cork blocks and cork
agglomerate. This led the Raw Materials BU to restructure its cork
block sector significantly to bring capacity in line with the current
level of orders.
In 2015, the BU invested strongly in the technological modernisation
of its unit for producing discs for champagne stoppers in terms of
both selection and automating disc production. Important steps were
also taken to automate the cork preparation process. This involved
trials of new production machinery and produced positive results.
Cork Strips and Planks
Raw materials — Sales & EBITDA
In December 2015, the Raw Material BU acquired a new unit at Ponte de
Sor with the aim of expanding the area available for cork preparation
and warehousing.
Measures were also taken in 2015 to consolidate the BU’s Forest
Intervention Project through the launch and development of a wide
range of research projects aimed at overcoming some of the problems
and threats that cork oak forests face.
(thousands euros)
135,437
131,373
111,120
Reflecting the conclusions of research and development projects and
investments made in 2014, the BU improved the sensory qualities of it
products, preparing the way for capitalising more effectively on the
qualitative aspects of cork as a raw material. Innovative decontamination
and storage process enabled the BU to increases its supply sources
and optimise the cork its purchases, even in areas that traditionally
involve greater risks in terms of sensorial quality.
14.2%
13.3%
12.5%
15,829
17,492
16,988
2013
Sales
2014
EBITDA
2015
EBITDA (% on sales)
23
CORK STOPPER S INDUSTR IAL PRODUC T ION
2.2. Cork Stoppers
Interesting dynamics characterise the global wine market: world
exports have doubled over the past 20 years, with Europe, which
exports 58% of its annual production, continuing in the lead. “New
World” countries (New Zealand, Chile, Australia and South Africa) have
increased exports by 370%. While Europe continues to account for 50%
of world wine consumption (84 of the world’s 100 most famous brands
are French), the US has overtaken Europe in per capita consumption,
with an annual average of 12 litres per head of mainly imported wines.
The 12 leading wine-producing countries account for 84% of world
production, currently estimated at 47 million hectolitres a year, a
total that has increased only 2.2% over the last 20 years. Although
European wine production, which accounts for 59% of the world total,
has stabilised at 146.6 million hectolitres a year, production by new
wine-producing countries has increased 48% over the past 20 two
decades. Over this period, Chile, Australia and New Zealand registered
growth of between 100% and 300%.
In spite of fierce competition from the US, Argentina, South Africa,
Chile, Australia and China, traditional wine-producing countries are
still the biggest global suppliers. Together, France, Italy and Spain
account for about 47% of world wine production.
The economic crisis and the rising price of wine had a strong impact
on wine consumption in Europe, leading European wine producers to
adopt a global strategy aimed at reaching other continents, especially
Asia and the US. Wine exports, which account for 35% of world wine
production, have almost doubled over the past 20 years. Over the
same period, the increase in the value of wine exports (87%) exceeded
the growth in volume (63%).
World production of sparkling wine, which has been growing at annual
rates of about 3%, reached 2.15 billion bottles. The international success
of champagne has inspired every country with a even a moderate
amount of production capacity, globalising the sparkling wine market
and democratising consumption.
The Cork Stopper BU operates in this market, with its differing rates of
growth, in accordance with its fragmented geography and segmentation
in spite of the growing dominance of a few global players. This means
the BU has to monitor market trends and movements in a focused and
organised way, adjusting its business strategy whenever necessary.
24
Positioning itself as a cork specialist, the BU offers this highly demanding
market the best value proposition: the best cork stoppers and related
services for each wine segment in a portfolio that includes natural,
micro-granulate and convenience cork stoppers. It invests strongly
in mature markets such as France, Spain, Italy and the US as well as in
emerging markets, especially China, where its technical competence
and commercial structure have supported its success.
In 2015, the Cork Stopper BU continued to grow, reflecting the following
important factors:
×× Increased wine consumption in key markets, which had a
positive impact on the BU’s export markets;
×× A well-organised commercial structure supported by critical
knowledge of products, the market and customer requirements;
×× A board product range that meets all the requirements of a
demanding market;
×× Operations in every wine market, resulting in high service
levels and proximity to customers;
×× Corticeira Amorim’s recognised position as the best supplier
in the market in terms of quality, availability, service, product
development capacity and business sustainability.
In 2015, the Cork Stopper BU recorded a 9.9% increase in sales value
compared with the previous year (+€355 million) and a 4.6% increase in
volume to 4.2 billion units sold. At the same time, the unit maintained
its sales mix and strengthened its position in all product segments.
The BU strengthened its position in 2015, not only in mature markets
(Italy and Spain), but also in markets with high growth potential (the
US, Chile and Argentina). It registered a slight slowdown in France,
where the 2015 grape harvest for the great Bordeaux châteaux was
down 23%-30% in volume, and a sharp fall in East Europe, especially
Russia and Ukraine (in line with trends in 2014).
Sales in 2015, which totalled €392.8 million, benefitted from an important
exchange-rate advantage resulting from the appreciation of the US
dollar that accounted for 40% of the increase in sales revenue. Sales also
benefitted from maintaining or slightly increasing the prices of all the
product range, even in markets where the exchange rate appreciated.
Sales of natural cork stoppers, the BU’s key product, which accounts
for 35% of its total sales volume, increased moderately. In regard to
individual markets, sales to France showed no increase and underwent
a downgrade in terms of the product mix as a result of the weak 2014
wine harvest. US buyers continued to favour natural cork stoppers
across their product range, especially in the premium and ultrapremium segments, which experienced considerable growth. Sales
in East Europe fell for the second consecutive year due to political,
social and economic factors. Sales to Argentina, Chile and South
Africa performed well. These are strategic markets for the BU, where
a physical presence and service levels are vital to consolidating and
strengthening its market leadership.
introduction of new artificial vision technology also contributed to
the strong margin performance. However, a significant 3% increase
in the cost of raw cork had a negative impact on the gross margin.
Cork Stoppers — Sales & EBITDA
392,825
357,302
333,657
16%
12.4%
Sales of Neutrocork stoppers increased significantly. In the range of
closures available for the table wine market, they are the product
whose sales have increased most, not only because of their mechanical
consistency and sensorial qualities, but also due to an excellent
cost-to-quality ratio. As a result, they have become crucial to the
battle against alternative closures.
Sales of Twin Top stoppers also grew, both in volume and value (the
exchange-rate effect being important). This occurred across all markets
with the exception of East Europe, where sales dropped significantly
due to the political, social and economic factors referred to above.
(thousands euros)
41,414
2013
Sales
13.1%
46,830
2014
EBITDA
62,753
2015
EBITDA (% on sales)
Sales also increased in the champagne stopper segment.
EBITDA expurgado dos efeitos da imparidade de goodwill (2012)
The BU’s gross margin rose by 16.8% compared with 2014, reflecting
a 9.9% increase in sales, the positive exchange-rate effect and an
improvement in the product mix. The positive evolution of exchange
rates accounted for 73% of the total increase in sales revenue. Industrial
improvements introduced in some consumer segments and the
Operating costs increased slightly more than 8% compared with 2014
due to the BU’s increased activity, a negative exchange-rate impact and
some delay in implementing operational efficiency measures planned
for 2015. In spite of this increase, the cost-to-sales ratio improved
in comparison with 2014, falling from 27.2% to 26.8% (excluding
depreciations and amortisations).
CORK STOPPER S’ SENSOR IAL ANALYS IS
25
Non-cash costs (amortisations and impairments) increased considerably.
This reflected poorer quality collection and an increase in amortisations
resulting from the large investments made in recent years.
The operational efficiency programme, although somewhat delayed,
helped control fixed production costs and contributed to an improvement in productivity, with the cash costs-to-gross margin ratio falling
by some six percentage points.
EBITDA increased 34%. EBIT grew 40% in comparison with 2014. This
reflected increases in sales and the gross margin together with a
slight increase in variable costs. There was no change in fixed costs.
Capital invested rose by 13.9% (€28 million), with the average turnover
period for third-party balances remaining unchanged. This was not
the case with stock levels, for which the average turnover period
increased by 13 days. This was due to faster growth and poor supply
chain visibility, especially in Portugal and the US. In spite of this,
however, the turnover of working capital was 3.22, in line with 2014.
The high level of investment was mainly targeted at improving quality,
product performance and operating efficiency. The value of fixed
assets increased by €3.7 million.
Highlights of 2015:
×× Strengthening market leadership with a 4.6% increase in sales
volume in a wine market that grew by about 1%;
×× Regaining important positions from alternative closures thanks
to an increased awareness of cork and advances in technology
and sensorial quality;
×× An improved position in the spirits segment, breaking into the
Latin American and Asian markets thanks to a strengthened
team and an effective production and technological structure;
×× Wide promotion of the Helix packaging system, especially
among leading customers, with more than 275 presentations
and more than 100 trials;
×× Important promotion and communication initiatives aimed
at increasing proximity to customers and opinion makers;
×× Industrial layout improvements and critical defect elimination
technology for the production of champagne stoppers;
×× Conclusion and stabilisation of the artificial vision process and
seal control in the natural cork stoppers for wine segment, thus
improving the manufacturing process and product consistency;
×× An increase in the BU’s knowledge of products and its competitive position in relation to other leading market players, paving
the way for overall improvements and a new sales pitch;
×× Strengthening the management of processes and teams in
line with Lean/Kaizen principles by means of the Cork.mais
programme, which is now operational in every area of the BU;
×× Strengthening training and improving qualifications and skills
across the BU with a view to continuous improvements and
adapting skills to market requirements.
Wicanders, ArtComfort, Recla imed
26
2.3. Flo or and Wall Coverin g s
In 2015, the total sales of the Floor and Wall Coverings BU reached
€109.8 million, a drop of 5.6% compared with 2014. EBITDA totalled
€8.2 million, a significant decline (€15.5 million) from the previous year.
In general terms, the BU’s sales and profitability were penalised by
a reduction in manufactured product sales (-4.3%) and a sales mix
with lower margins. In addition, the negative impact of the EUR/USD
exchange rate (€1.5 million) led to an increase in consumer prices for
LVT and timber.
Geographically, the drop in sales of manufactured products was focused
in East Europe, especially Russia, reflecting the adverse political
climate, and in the US. The growth registered in other markets, such
as Scandinavia and Germany, although important, was not strong
enough to invert the downward trend caused by the fall of sales in
the Russian and US markets.
The investment in promoting CORKTECH as a distinctive element in
the floor and wall coverings sector will differentiate the BU’s product
range from other solutions available in the market, a differentiation
that is based on incorporating cork through the use of appropriate
technology.
The creation of the CICIA will enable the BU to optimise and unify the
product knowledge of key people in the world of prescription flooring
and to promote CORKTECH as the leading competitive advantage of
the BU’s products.
The Centre has a space dedicated to simulations that will enable
stakeholders to interact directly with the Floor and Wall Coverings
BU’s portfolio of products and solutions. By means of the collaborative
process and the feedback obtained, this space will enable the BU to
monitor trends and develop new ideas, designs, looks and applications
to ensure a permanent increase in the value of cork in high value-added
floor and wall covering products.
The launch of new water-resistant products with an innovative composition opened up markets for the BU that had previously been at an
incipient stage and which now promise to sustain future sales growth.
Volume sales of products retailed but not manufactured by the BU, the
result of the investment in value-added products that characterises
the unit’s position in a highly competitive market, increased by more
than 1% in central Europe in spite of strong pressure on the margin
caused by the USD/EUR exchange rate.
At the industrial level, the transformation of the product portfolio led
to a redesign of manufacturing processes and related technological
optimisations, with a special focus on the energy component and on
product cost reduction. In regard to the supply chain, efforts continued
to optimise invested capital through the introduction of practices
aimed at averting and resolving problems related to materials with a
low turnover. These practices were expanded to cover all the materials
used by the BU, thus strengthening its balance sheet.
In 2015, a decision was made to support the Collaborative Innovation
and Applied Research Centre (CICIA) by creating a dedicated space for
the project. This innovation and research centre, complemented by an
exhibition of the BU’s product and solutions portfolio, was the result of
strong and targeted investment in the BU’s core business – cork – and
its mission “to be a global player in the floor and wall covering markets,
using CORKTECH as a differentiating factor”.
Floor and Wall Coverings — Sales & EB ITDA
(thousands euros)
122,009
116,363
109,843
12.4%
13.3%
7.4%
15,177
15,520
8,173
2013
Sales
2014
EBITDA
2015
EBITDA (% on sales)
Wicanders CorkcoMfort
27
The complementarity of this Centre with the AR Academy, the goal of
which is to disseminate the advantages of CORKTECH technology to all
stakeholders and expand the global level of knowledge of the unique
properties of cork as a raw material, as well as its advantages when
incorporated in floor and wall covering products, will strengthen the
capacity of the BU suitably to position its products in different market
segments. This will help increase awareness of the differentiation achieved
by using cork and forms the basis of the competitive advantages of
the BU’s product range.
This new strategy represents a clear strengthening of the BU’s existing
marketing methods, aimed, through a process of acculturation, at turning
stakeholders into messengers of this strategy and equipping them
with the necessary knowhow to play an important role in promoting
the BU and its products.
×× A strategic clarification of business frontiers and the development of a new global model for segmenting the market, thus
improving the identification and fulfilment of opportunities;
×× Identifying the priority segments and regions on which growth
will be based in the coming years and developing strategies
for each specific segment to be implemented in accordance
with the specificities of each regional market;
×× Developing a new innovation model in line with the strategy
for providing the BU with a permanent flow of new products
by means of a robust and participative process, both internally
and externally;
2.4. Comp osite Cork
×× Designing a new organisational structure for commercial and
innovation operations, including a diagnosis of requirements
for developing skills, processes and systems;
In 2015, the turnover of the Composite Cork BU reached €100 million,
an increase of 18.6% over the previous year. EBITDA evolved extremely
positively, reaching €14.6 million, a gain of 82% compared with 2014.
Sales growth made a decisive contribution to the increase.
×× Implementing a comprehensive programme of operating
efficiency measures capable of making a real impact in the
market, thus actively promoting the competitiveness of the
BU and improving customer service levels;
A significant share of the increase in sales (about 45%) can be attributed
to the appreciation of the US dollar in comparison with the 2014 exchange
rate, but it does not wholly account for the increase in sales volume.
×× Completing the process of geographic concentration by
transferring the cork rubber production lines and capitalising
on synergies and economies of scale in regard to logistical
and industrial costs. These initiatives were rescheduled with
a view to minimising potential negative impacts on customer
service levels.
Geographically, sales in the US increased significantly. Growth was
also globally positive in emerging markets. Winning and retaining new
customers remained a priority in 2015 and again produced exceptionally
positive results.
The launch of new products on the market and the development of
new applications, two central goals of the BU’s strategy, also made an
important contribution to sales growth as well as helping to create value
in the market. Generally speaking, commercial margins also increased,
even allowing for the positive impact of the exchange rate. Real unit
costs for cork and non-cork raw materials fell slightly below 2014 levels,
another factor that contributed positively to the BU’s performance.
In production, income from cork milling operations evolved favourably
in comparison with 2014, reflecting consumer choice and purchasing
rigour. Allied to the strong performance of the double-belt press
agglomeration processing line, this helped offset the negative impact
of some inefficiency verified in the cork rubber processing line, mainly
during the first half of the year. These were related to the transfer of
production from Corroios to Mozelos.
The relocation of the cork rubber and agglomerate production lines also
made it necessary to increase related resources significantly in order
to minimise the impact of the move on service levels, although this
was not totally achieved, especially during the first months of the year.
Despite these temporary shortcomings in industrial efficiency, however,
overall performance levels improved considerably. Operating costs
remained under control in spite of, in this case, the negative impact of
the exchange rate, and without affecting investments that needed to be
made in strategic projects aimed at improving the BU’s medium-term
performance.
Action was also taken during the year to optimise the capital invested
in the BU’s operations, specifically in regard to working capital needs,
by improving the management of inventories and third-party balances.
In 2015, steps were also taken to strengthen the infrastructures supporting the BU’s sustained economic performance in three main
areas: innovation, partnerships and human capital. Indeed, the year
was an important milestone in the BU’s transformation process and
the framing of a new ambition for improving performance through a
number of important initiatives:
28
In terms of the new segmentation model, the industrial market remains
the most important segment in the BU’s diversified portfolio, although
it lost some of its dominance in 2015 due to significant growth in the
other main sectors – retail and construction. In spite of having grown
about 7%, the industrial segment accounted for 41% of total turnover
at the end of 2015, compared with 46% a year earlier.
Of the BU’s 11 industrial market segments, only two failed to achieve
any growth in relation to 2014: Industrial Packaging and Composite &
Rubber Cork Manufacturers, both of which registered slight reductions in
sales. Among the other industrial segments, Footwear, Other Industrial
Equipment, Machinery & Parts and Automobiles & Auto Parts + Other
Vehicles achieved particularly strong sales growth.
Retail was the second most important cluster of segments in 2015,
achieving sales growth of 32% in comparison with the previous year. The
Furnishings (which achieved exceptionally high growth starting from
sales of only €200,000 in the previous year) Construction Specialty
Retail and Office Products contributed particularly strongly to growth.
Of the 10 segments in the retail cluster, only Leisure Goods suffered
a slight decline in sales.
In construction, the last cluster with only four segments, sales also
performed strongly, expanding 44% on 2014 and increasing their relative
weight in overall sales from 15% to 18%. All four segments expanded
their sales, with Resilient & Engineered Flooring Manufacturers and
Other Flooring Type Producers almost doubling their sales volumes.
Finally, in regard to cork materials, the reduction in the commercialisation
activities for these raw materials continued as expected to the point
where it became almost residual in 2015. There was also a growing
trend towards subcontracting some non-core production operations.
In geographical terms, the strongest sales growth was recorded in
the US (and not only because of the exchange rate effect). On the
negative side, some difficulties were experienced in Russia due to its
domestic economic climate. However, in general terms, the year was
marked by a broad increase in sales.
Composite Cork — Sales & EBITDA
(thousands euros)
In summary, turnover rose strongly, increasing 18.6% in comparison
with 2014 with core market sales (that is, excluding raw materials and
subcontracting) increasing 21.8%.
99,980
98,443
As previously mentioned, the evolution of EUR/USD exchange rate
had a significant impact. Sales of new products and products for new
applications were also important components of the BU’s organic
growth, which was geographically diversified over several markets.
84,282
14.6%
×× Second phase of the transfer of cork rubber agglomerate
production and related efficiency improvements;
9.2%
×× Increased granulate production capacity in readiness for
projected future growth;
6.8%
14,585
6,726
2013
Sales
Investment in fixed assets totalled €3.6 million in 2015 and included:
2014
EBITDA
×× Energy efficiency measures – electrical and thermal.
7,748
2015
EBITDA (% on sales)
Tipsy, by Keiji Takeuch i for Mater ia collect ion
29
2.5. In sul ation Cor k
insulation Cork — Sales & EBITDA
In 2015, the Insulation Cork BU’s sales totalled €10 million, an increase
of 0.3% on the previous year.
The gross margin rose by 11% compared with 2014. The increase reflects
an increase in sales of higher value-added products together with a
positive exchange rate effect and the previously mentioned cessation
of milled cork sales.
10,040
8,120
16.6%
EBITDA totalled €1.2 million, a drop of 24.9% compared with the previous
year. Debt impairments relating to two markets played a significant
part in this fall. Excluding this effect, EBITDA would have reached €1.9
million, representing a 15% increase on 2014.
16.5%
12.4%
During 2015, the BU engaged in a number of initiatives aimed at
enhancing its business potential and consolidating its leadership in
the supply of expanded cork agglomerate solutions, thus improving its
international profile and perceptions of the real value of its products.
These initiatives included:
×× In partnership with Gyptec Ibérica, the Insulation Cork BU was
represented at Tektónica 2015, highlighting, in particular, the
Institute of Architects auditorium. The inspiration behind the
Gyptek Business auditorium was Gypcork board, a multilayer
building solution that brings together two high-quality
Portuguese products – Gyptec laminated plasterboard and
expanded cork agglomerate;
(thousands euros)
10,014
1,349
2013
Sales
1,653
2014
EBITDA
1,241
2015
EBITDA (% on sales)
×× Use of expanded cork agglomerate in the façade of the
Penitenzieria building next to Turin Cathedral in Italy and as a
technical solution providing thermal and acoustic insulation,
it being the principal building material used in constructing
the new prayer space for pilgrims who come to see the Holy
Shroud of Turin;
×× Extensive use of MDFachada expanded cork agglomerate in the
Brazilian Pavilion at Expo Milan, a solution that in architectural
terms perfectly fits the profile of the project led by Studio
Arthur Casas and Atelier Marko Brajovic;
×× Participating in dozens of international conferences;
×× Participating in GREENFEST, the biggest event in Portugal
aimed at advancing sustainability and celebrating the best
environmental, social and economic practices. It was based
around the theme: Active Citizenship;
×× Presenting at Concreta (Portugal) a new collection of wall
coverings using innovative concepts that combine insulation
and design, namely the WAVE FAÇADE range.
In regard to operating efficiency, the adoption of more efficient
working methods, rigorous cost control and investments made in
the BU’s manufacturing units in recent years generated substantial
improvements.
Total capital invested in 2015 fell 8.2% in relation to 2014, due mainly
to a reduction in stocks and other net asset items.
MDFAÇADE WAVE
30
3
INNOVATION,
RESEARCH
& PRODUCT
DEVELOPMENT
3.1. Cork Stoppers
In 2015, the Cork Stopper BU’s research, development and innovation
activities were reflected in the launch of new projects and a significant
progress in projects already underway.
Efforts to eliminate the sensorial problems affecting cork stoppers
made important advances. Projects for direct application in the
production process and of critical importance for the future of natural
cork stoppers for bottling wine and champagne were concluded.
Knowledge was also gained regarding many of the aspects related
to the interaction with wine and spirits of the compounds that cause
sensorial problems in cork stoppers.
The detection of TCA[1] in natural cork stoppers progressed greatly
thanks to the use of methods for analysing individual stoppers very
quickly that can be applied directly in the manufacturing process. The
first piece of industrial machinery for doing this went into production
in 2015 and produced positive results. At the same time, new methods
were developed and put into practice capable of achieving the highest
possible standards of detection. Equipment for analysing champagne
stoppers was also developed as part of this project and is expected to
enter the testing phase in 2016.
Research that led to the development of a new method for extracting
TCA from the granulate used in champagne stoppers was also concluded
successfully. The new process has already been installed and is expected
to be applied on an industrial scale in the first quarter of 2016.
Trials were also made of several processes and products aimed at
reducing the presence of TCA and other volatile compounds in cork
stoppers. These projects involved the collaboration of Portuguese
and international partners and will continue in 2016.
An intense study of the interaction of alcoholic beverages with TCA and
other volatile compounds responsible for unpleasant odours was carried
out in 2015. This has provided the BU with much greater knowledge of
the factors that affect that interaction, specifically migration kinetics
and the limits of sensory detection. In collaboration with a Portuguese
partner, the Cork Stopper BU also undertook a project designed to clarify
these limits and understand the real importance of these compounds
in the contamination of cork stoppers and, consequently, of wine.
1
TCA: 2, 4, 6 Tricloroanisol.
ROSA® syste m (R ate of Optim al Stea m Application)
31
In addition to work on sensorial factors, significant advances were
made in 2015 on a treatment application for standardising surfaces,
on improving the quality of covering solutions and on dealing with
clogging in natural cork stoppers.
Considerable progress was also made with innovations related to
production processes, including the introduction of new stripping, milling
and packaging equipment, which was developed in cooperation with
Portuguese companies and has already been installed. This equipment,
which the BU has already patented, will make a strong contribution
to improving the efficiency of cork stopper production processes.
Other innovation projects related to manufacturing processes, such
as the development of new generations of bevelling machinery and
electronic selection equipment also advanced in 2015, but have not
yet been definitively concluded.
Significant progress was made with the innovation of technical products,
namely Neutrocork and TwinTop stoppers, including the development
and approval of new formulations following detailed physical-mechanical
tests and bottling trials.
In the area of technical products, work was also undertaken throughout
the year to develop better performing glues that meet the highest
quality standards. Several alternatives to the glues currently in use were
validated and a QREN project in this research area was also concluded.
The consumption safety of the products the BU supplies is a constant
concern and innumerable analyses were made during the year to control
the migration of compounds from the cork or additional components
used in producing stoppers. The results obtained guaranteed the quality
consistency of the unit’s products in compliance with European and
US regulations governing food contact products.
To gauge the performance of its products in relation to competing
goods, the BU participated in a number of comparative trials of bottle
closures, organised either with its customers by the BU itself or by
reputed international research institutes in the wine industry. Overall,
cork stoppers were shown to be efficient closures and to ensure the
balanced ageing of wine. The results of some of these comparisons
were published in scientific journals.
The contra-faction of wines and spirits is also a constant concern,
especially for higher value-added products, and it falls on the cork
industry to contribute to resolving the problem. This is exactly what
the Cork Stopper BU has been doing, having in 2015 registered the
patent for a system that detects packaging violations of capsule cork
stoppers. Projects are also underway aimed at resolving the problem
of contra-faction as it relates to cork stoppers used in wine bottles.
In cooperation with Portuguese and international bodies, several
studies were made aimed at achieving a better understanding of the
BU’s products and the factors involved in ensuring a good physicalmechanical performance and how these factors contribute to the
balanced and harmonious ageing of bottled wine. Scientific publications
setting out the results of these studies were presented at specialist
congresses. Careful studies were also made with a view to gathering
the information required for a revision of the ISO technical standards
that apply to the sector.
In 2015, extensive research was conducted on champagne stoppers:
a study was made of the ideal storage for maintaining sealing qualities of champagne stoppers and research was also begun aimed at
understanding the expansion that sometimes prevent the formation
of the classic mushroom shape associated with champagne stoppers.
Technical Cork Stoppers product ion process
32
3.2. Flo or and Wall Coverin g s
For the Floor and Wall Coverings BU, 2015 was another year marked
by the development and presentation of new technical solutions that
highlight its capacity for product innovation. As well as improving
the unit’s product range, these new solutions will support growth
in specific market segments and facilitate entry into new segments.
Inspired by recent trends in eco-design, which prioritise the use of
ecological and reusable materials, Reclaimed (Visuals with a story to
tell) is the name of a new Artcomfort range based visually on used
wood and stone and having the appearance unique restored materials
that carry with them their own story. Comprising four different wood
looks and three stone looks, the collection is exceptional for the way
it reproduces the appearance of wood or stone in cork flooring with
a precision never previously seen. This has been made possible by the
use of realistic surface printing technology developed for consumers
who know and value the benefits of cork flooring, but who aesthetically
prefer materials like wood and stone.
Conceived with the motto “Why only fit in when it was created to stand
out”, the new Authentica technical solution marks a true revolution
in the vinyl flooring sector: its innovative composition represents a
change of paradigm for this type of flooring. The nucleus of the flooring,
which is made from natural materials, is 4mm thick and incorporates
a new cork agglomerate that is 2.7mm thick, making it the most
environmentally-friendly option available for this category of flooring.
The benefits of introducing a new layer of cork into this flooring range
are not limited to its green credentials. The tests that preceded the
launch of the collection showed clear improvements in performance,
specifically in terms of thermal resistance, with gains of about 18%, and
noise reduction, with improvements of about 6%. The collection was
developed for spaces with high traffic flows, including busy public spaces.
The CorkComfort range was also renewed with the introduction of a new
natural cork look in a collection called Novel Symmetries, developed
in partnership with the Italian designer Antonio Bullo.
Other projects were also launched in 2015 with the aim of preparing
the Floor and Wall Coverings BU’s future product range. The success
achieved with the launch of Hydrocork PressFit spurred the further
development of water-resistant products as well as the use of the
PressFit fitting mechanism in other technical solutions.
A project was launched to develop innovative aesthetic looks for cork
in terms of both design and technology. Partnerships with suppliers
and the development of skills in the R&D and production teams were
crucial to this process.
3.3. Comp osite Cork
The Composite Cork BU is dedicated to the continuous development
of new cork solutions and to meeting the challenge of discovering new
uses for cork composites in different business areas.
A research, development and innovation management system was
introduced in 2015 involving a reorganisation of this area and bolstering
technical skills in preparation for the global growth of the business.
Strategically focusing innovation projects in this way led to the creation
of new business concepts for different clusters of market segments
and geographical regions. These included:
a) Construction:
×× The creation of a disruptively innovative concept for a flooring
core using bio-composites and recycled plastic, excluding
PVC, a project that is at the advanced development stage;
Wicanders, CorkComfort, Novel Sym metries
×× An underlay range with new functions and made from cork
composites;
×× New natural substrate solutions made with cork granulate
and equipped with new functionalities for the synthetic grass
pitch market that will help the BU expand an existing product
range that has successfully captured a significant share of the
European and US markets;
b) Industr y:
×× The development of extrusion technology for cork-nitrile
rubber that will enhance the BU’s range of vibration control and
sealing solutions with the introduction of three-dimensional
products;
×× The development of a new cork composite for use in the
bio-sensor industry;
×× The development of thermal and acoustic shields to replace
foam tiles and synthetic fibre in automobile exhaust systems;
c) Retail:
×× The development of new cork agglomerate formulas for
applications involving direct or indirect contact with foodstuffs,
a project aimed at supporting market share growth among
leading international distributers and retailers;
33
d) Footwear:
×× The development of new cork composite materials for the
orthopaedic sector that maximise the visual and functional
qualities of cork.
The continuation of systematic research aimed creating new value-added
solutions in which the use of cork adds a distinct competitive advantage.
In 2015, an initiative was launched to expand the network of international
scientific and technological bodies that work with the Composite Cork
BU in order to maximise the exploration of new disruptive concepts.
The strengthening and expansion of these strategic partnerships
will contribute decisively to advancing the BU’s knowhow as well
as improving efficiency in developing new products, processes and
business models.
In this area, the following European R&D cooperation projects were
of particular note::
×× Osirys – the use of natural products that perform well in
terms of interior air quality, fire and fungus resistance and
energy efficiency; and;
×× Ablamod – a project aimed at making substantial progress
towards the conception of a thermal ablative protection system
incorporating aspects of advanced ablation characterisation
and modelling. As most interplanetary missions designed to
bring back samples use a system of thermal ablative protection,
progress with this project would help ensure the low risk
re-entry and return of spacecraft.
In 2016, innovation challenges include developing cork composite
materials with improved thermal, acoustic and vibration insulation
qualities, identify new applications, reducing production costs through
the introduction of new technologies and optimising raw material use.
The permanent search for new products, new markets and innovative
applications forms the foundation of our growth strategy for the
Composite Cork BU.
3.4. Insul ation Cork
In 2015, development cycles were concluded and new R&D projects in
consortium were begun with the aim of maintaining the pace of the
BU’s research activities. These initiatives included:
×× Conclusion of the MDFachadas and MDCoberturas projects,
thus fulfilling the goal of optimising a building system that
uses expanded cork agglomerate tiles to cover the façades
and other outer parts of buildings in a way that also provides
the required levels of thermal insulation;
×× Conclusion of the ISOL TILE SYSTEM, optimising a system
that enables ceramic tiles to be laid over thermal insulation
on the outside of buildings, guaranteeing compliance with
the applicable mechanical requirements, system durability
and ensuring high performance in hygrothermic, acoustic
and energy terms;
×× Conclusion of the Floatwing project, a modular floating house
providing accommodation that is in harmony with nature and
water and that is also self-sufficient and sustainable in both
energy and environmental terms;
×× Launch of the Coberturas Verdes [Green Coverings) project
aimed at creating green coverings and living façades using
systems made entirely from expanded cork agglomerate, a
totally natural and environmentally-friendly product;
×× Launch of the Slimframe PV & Cork Skin project aimed at
creating an insulated building façade system that uses solar
energy and developing, as part of a consortium, a solution
that uses expanded cork agglomerate and glass for insulation.
The projects are part of a strategy for developing innovative products
and applications by creating new solutions that add value to the use
of cork as a raw material.
CONVER GE / DIVERGE Space , a partnersh ip A morim Isola mentos / IDEIA . M and the Faculty of Engineering of the Univers ity of P orto
34
4
SUSTAINABILITY
POLICIES AND
PRACTICES
Corticeira Amorim continues to focus on aligning management sub-systems that foster
efficiency and integrating them with the strategic aims of a balanced scorecard approach as
an important guarantee of the company’s sustained development. To guarantee the effective
management of environmental and social factors, geared to achieving strategic objectives,
Group companies have implemented management policies and systems in keeping with the
non-financial risks that their activities incur and the opportunities that emerge in the markets
in which they operate.
The companies in the Group have sought to consolidate this alignment by renewing the
certification of its management sub-systems. These renewals include:
×× At the Cork Stopper BU, the SYSTECODE (Accreditation System for Companies that
apply that International Code of Cork Stopper Manufacturing Practice) and HACCP
ISO 22000 (Food Safety Management System);
×× At the Composite Cork BU, the Programme for the Endorsement of Forest Certification
and OHSAS ISO 18001 (Workplace Safety and Hygiene Management System);
×× At several Group BUs, ISO 9001 (Quality Management System), the Forest Stewardship
Council and ISO 14001 (Environmental Management System).
In 2015, Corticeira Amorim concluded its transition to the most recent guidelines of the Global
Reporting Initiative (version G4), a process that will culminate with the publication of the 2015
Sustainability Report, which reflects a revision of the company’s Sustainability Strategy in line
with a process of consulting stakeholders and analysing the issues involved.
Special mention should also be made of the policies Corticeira Amorim has adopted in
the form of voluntary ethical commitments related to economic, environmental and social
responsibility. The different companies in the Group have adopted these commitments as a
management model grounded on responsible competitiveness.
Ethical and legal responsibilities
×× To act in a responsible and ethical way in compliance with legal and regulatory
requirements and the objectives applicable to the operations of subsidiary companies;
Responsibilities to external stakeholders
×× To promote the satisfaction and loyalty of customers by developing differentiated and
competitive products and services;
×× To guarantee value creation for shareholders over the medium and long term by means
of responsible competitiveness;
×× To maintain trusting relationships with interested parties, specifically suppliers,
customers and society in general;
Product responsibility
×× To guarantee quality, based on the continuous improvement of processes as well as
products and services and by searching for innovative solutions based on technological
developments to meet customers’ needs with competitive and differentiated solutions;
35
Social responsibility
×× To develop the skills and qualifications of employees, providing them with an encouraging, healthy and safe working
environment;
×× Guaranteeing compliance with the legal requirements and
any other standards to which the organisation subscribes
that apply to the environmental aspects of its operations,
products and services;
Environmental responsibility
Corticeira Amorim’s activities have unique characteristics in the field
of sustainability, constituting a rare example of interdependence
between industry and an ecosystem, as well as generating wealth and
preserving the environment. By engaging in the regular harvesting of
cork, Corticeira Amorim ensures the viability of cork oak plantations in
Portugal and the Western Mediterranean Basin, a natural resource that
performs a fundamental role in capturing CO2, preserving biodiversity,
regulating the hydrological cycle and combating desertification.
In addition to benefiting from cork as a gift of nature, Corticeira Amorim
works to apply and strengthen sustainable development practices to
all its operations. As with any other industrial activity, the company’s
manufacturing processes have an inevitable environmental impact. To
minimise this impact, and in keeping with its own sustainable management principles and practices, Corticeira Amorim is committed to:
×× Controlling important environmental factors and contributing
to pollution prevention;
×× Working proactively to identify, evaluate and put into practice
appropriate preventive measures for minimising the specific
environmental impacts of its different operations, and deploying
whenever possible the best available practices and technologies.
Supply Chain Responsibilities
×× To give preference, whenever possible, to suppliers who
provide raw materials in accordance with the best social and
environmental sustainability practices in regard to sourcing
and production processes.
Cork oak forest
36
5
the development of complex commercial structures, the solicitations
and demands for enhanced skills and new structures are great. For this
reason, significant investments were made in training, with a total of
some 45,000 hours of training being given in 2015.
HUMAN
RESOURCES
In 2015, investment continued in the continuous improvement
programmes run by Group companies, an area in which Amorim &
Irmãos, S.A. received the Kaizen Institute Award, a prize awarded to
the best performing companies in this category.
Special mention should also be made of the custom-made training
programmes organised by Group companies to meet the needs of
specific projects in their commercial, customer service and industrial
operations areas.
Corticeira Amorim’s organisational culture is founded on five essential
values: pride, ambition, sobriety, initiative and attitude.
The strategic programmes of the Group’s different companies create
a need to acquire, develop and differentiate skills adapted to different
contexts. The concepts and practices of a goal-driven approach and
a merit culture have been adopted by every segment of the Group’s
workforce, requiring the strengthening of management and remuneration systems. These guidelines lie at the centre of, and constitute the
standards governing, the human resources policies and practices that
the Group and its subsidiaries implemented in 2015.
At the end of December 2015, Corticeira Amorim had 3,537 employees.
Most of these workers – 2,508 – are employed in Portugal, where the
industrial units of Group companies are predominantly based. The
other 1,029 work in countries across the world, including not only
Spain (228), the US (134), France (106), Germany (71) and Italy (43),
but also Morocco, Tunisia and Algeria, countries where the Group
has a combined staff of 193. The average number of employees in
2015 was 3,636.
Another area of intervention in 2015 focused on the Group’s performance
management system, with training and awareness sessions having
been provided to 200 staff members on the best ways to assess,
communicate and help people to improve their performance.
Adjustments were also made to the Group’s performance management
process to help make it even more productive in enhancing employee
and company performance.
Internal communication was also an important concern. Given the
benefits of focusing people on achieving goals, the importance of
behaviour in reinforcing the positive aspects of the Company’s culture
and the key role of communication in when parts of the Group are
being restructured, Corticeira Amorim used every opportunity and
engaged in a range of initiatives and approaches to transmit key
messages, clarify objectives and keep people informed, promoting
clarity and alignment with strategic goals.
Both the number of employees at the end of 2015 and the average
number for the year were at their highest levels since 2010, an increase
that reflects the enlargement of the consolidated group and the Group’s
strong increase in business activity.
The Corticeira Amorim workforce is generally quite stable, a fact
reflected in indicators such as turnover and a longevity of employment
averaging 15 years. In spite of this, the level of recruitment is quite
high, reflecting the impact of variations in industrial activities, a need
to strengthen skills and the renewal of some structures.
The average absentee rate in 2015 was 3.7%, a reasonable level in terms
of the average for industrial companies, although an increase on the
previous year. The rate covers short and long-term absences including
sick leave, which accounted for 2.9% of the absences registered in
Group companies.
Work accidents are also an important and pertinent issue. In spite
of a long-term downward trend, a total of 116 work accidents were
recorded at Corticeoira Amorim’s 20 industrial units in 2015. This
represents an increase in comparison with the previous year in both
the frequency and the seriousness of accidents. In response, a work
accident intervention programme was launched in 2015 with the goal of
achieving a substantial and sustained improvement in the Company’s
performance in this area.
Adapting the workforce to the Group’s strategic goals is also a permanent
concern. Seeking, attracting, developing, renewing and retaining key
skills are fundamental factors in keeping results at the required level.
The need to develop skills is common to all Corticeira Amorim
companies and structures. From industrial units implementing new
technologies and new ways of organising production that require skilled
employees to the creation of departments dedicated to product,
process and organisation innovation, through project management and
AR Acade my for floor ing competenc ies
37
6
STOCK MARKET
PERFORMANCE
Corticeira Amorim’s current share capital stands at €133 million, represented by 133 million
ordinary shares with a nominal value €1 and conferring the right to a dividend. The flotation
on Euronext Lisbon (hereafter referred to as BVLP – the Lisbon and Porto Stock Market) of the
shares issued within the scope of the capital increase that took place on December 19, 2000 was
added to the remainder of the company ‘s shares listed on the BVLP from the beginning of 1991.
These shares have been continuously traded on the national system since December 11, 1991.
On September 16, 2015, Corticeira Amorim launched a private offer for the sale of 7,399,262 of its
own shares, representing 5.563% of is share capital, through a process accelerated bookbuilding.
The offer was concluded on the same day with the placement of all the shares on offer at a
price of €4.45 per share. The share transaction was registered with the market on September
17, 2015. The Company’s stock market indicators reflect this operation.
At the end of 2015, Corticeira Amorim’s share price was €5.948, an appreciation of 97% on the
closing price at the end of 2014. About 12.7 million shares (264.6% more than in 2014) were
traded in 8,875 separate trades (103.7% more than in 2014) in operations with a total value of
approximately €56.8 million (up 481.7% on 2014).
In 2015, the average share price was €4.34 (compared with €2.85 in 2014). The shares reached
a maximum price of €6.29 on December 22. The minimum price for the year of €2.99 was
registered on January 2. The percentage change between the lowest and highest share price
in 2015 was 110.37%.
The following charts illustrate Corticeira Amorim’s stock market performance:
6.50
1,600,000
6.00
1,200,000
5.50
5.00
1,200,000
4.50
1,000,000
4.00
3.50
800,000
3.00
2.50
600,000
2.00
400,000
1.50
1.00
200,000
0.50
0.00
turnover
daily share price
38
31 dec
11 dec
20 nov
30 oct
09 oct
17 sep
27 aug
06 aug
16 jul
25 jun
04 jun
14 may
22 apr
28 mar
07 mar
14 feb
24 jan
02 jan
0
note: this graph does not include the transaction of the 7,399,262 of
Corticeira Amorim’s own shares (32,9 million euros) on 17-09-2015
source: Euronext
daily share price (EUR)
turnover (EUR)
Trading volumes on the regulated market in 2015
Stock market performance in recent years:
2012
2013
2014
2015
2,856,436
2,184,858
3,481,685
12,693,424
Maximum
1.65
2.40
3.65
6.29
Average
1.42
2.04
2.85
4.34
Minimum
1.27
1.56
2.20
2.99
Year-end
1.60
2.21
3.02
5.948
85.2%
89.3%
96.1%
98.8%
212,800,000
293,930,000
401,660,000
791,084,000
No. of shares traded
Share prices (€):
Trading frequency
Stock market capitalisation at year-end (€)
source: Euronext
Share price performance versus PS I20 (2015):
250
200
150
100
50
31 dec
13 dec
28 nov
13 nov
29 oct
14 oct
29 sep
14 sep
30 aug
15 aug
31 jul
16 jul
01 jul
16 jun
01 jun
17 may
02 may
17 apr
02 apr
18 mar
03 mar
16 feb
01 feb
17 jan
02 jan
0
source: Euronext
Corticeira Amorim
PSI 20
39
Corticeira Amorim main stock market announcements in 2015 were:
February 19: Consolidated results for 2014
Corticeira Amorim reported record sales of €560 million in 2014, with the following highlights:
×× Sales increased 3.3% to €560.3 million;
×× EBITDA grew by 11% to €86.7 million;
×× A further improvement in the financial autonomy ratio, which exceeded 50% for the
first time;
×× A proposal for a gross dividend of €0.14 per share was made to the Shareholders’
General Meeting.
March 24: Announcement of the payment of a gross dividend of €0.14 per share
May 11: Consolidated results for the first quarter of 2015
Corticeira Amorim’s sales rose to €147 million, with the following highlights:
×× Turnover rose 6%, benefitting from a positive evolution of the exchange rate, especially
of the US dollar;
×× Net profits reached €8.4 million, an increase of 41% on the first quarter of 2014;
×× EBITDA rose 44% to €23.8 million.
August 3: Consolidated results for the second quarter of 2015
Corticeira Amorim’s quarterly sales exceeded €300 million for the first time, with the following
highlights:
×× EBITDA grew by 24.7% to €54 million;
×× Quarterly profits increased 42.4% to €26 million.
September 16: Private offer for sale of own shares:
×× Announcements of a private offer for the sale of 7,399,262 own shares representing up
to 5.563% of total share capital, aimed exclusively at institutional investors through a
process of accelerated bookbuilding, subject to demand, price and market conditions;
×× Announcement of the private sale of all the own shares on offer to institutional investors
at a price of €4.45 in a sale that raised a total of €32.9 million.
November 2: Consolidated results for the third quarter of 2015
Corticeira Amorim’s nine-month sales reached their highest level to date in 2015, with the
following highlights:
×× Sales rose 7.7% to €463 million;
×× All Business Units reported higher sales than in the first nine months of 2014;
×× EBITDA totalled €80 million, the result of a strong operating performance.
November 13: Announcement of the payment of a gross dividend of €0.245 per share
Cork Rubber Gaskets
40
7
CONSOLIDATED
RESULTS
7.1. Summary o f activitie s
months, but also from a tightening of the criteria for the impairment
of overdue customer balances and of inventories from which there
have been no sales for a determined period.
The significant improvement in financial costs reflected a decrease
in remunerated debt as well as a further drop in the average interest
rate paid.
Associated company results performed exceptionally well as they
had in previous quarters. Improved performances by Trescases and
Corchos of Argentina (cork stoppers) and US Floors (floor and wall
coverings) saw appropriated earnings more than double.
In keeping with sales and EBITDA, Corticeira Amorim’s net profit also
passed a significant milestone, exceeding €50 million for the first time
as it rose to €55.012 million, an increase of 53.9% on 2014.
Although the overall pace of world economic growth slowed in 2015,
the economies of Corticeira Amorim’s most important markets grew,
albeit at a moderate rate.
Net profit in the fourth quarter was €13.402 million, almost double
the profit achieved in the same quarter of 2014.
The US, Corticeira Amorim’s most important market, grew for the sixth
consecutive year, not at a rapid pace but nevertheless at a considerably
faster rate than the modest growth registered in the European Union,
where the Group’s next most important markets are located.
At the end of the third quarter, Corticeira Amorim sold all the own
shares it held, increasing its free float to about 15%. The impact on
liquidity was almost immediate with the average daily volume of trades
increasing significantly.
Among Corticeira Amorim’s other significant markets, Russia performed
poorly, a contraction aggravated by the economic sanctions imposed
on the country. Dating from the second half of 2014, the sanctions
strongly conditioned sales to the Russian market. The Floor and Wall
Coverings Business Unit (BU), in particular, as well as the Cork Stopper
and Composite Cork BUs were the units most affected.
In light of a considerably positive financial position, strengthened by
the funds raised from the sale of its own shares, Corticeira Amorim
was able to distribute a robust €50.169 million in dividends in 2015, the
equivalent of 37.72 euro cents a share.
As highlighted in the Group’s quarterly reports, the exchange rate
effect was highly beneficial for Corticeira Amorim’s operations, with
the appreciation in the US dollar accounting for almost all of this
advantage. Combined with the growth of the US economy and the
special focus of sales teams on the US market, these factors highlight
the fundamental importance that the US has gained for Corticeira
Amorim’s sales and profits in recent years.
Because of its importance in the makeup of the Group’s financial
structure, special mention should be made of the loan agreement that
Corticeira Amorim signed with the European Investment Bank at the
end of the first quarter. The €35-million loan with a four-year grace
period was negotiated at an all-in interest rate lower than other existing
loan at that date. The agreement has enabled Corticeira Amorim to
lengthen the terms of its debt substantially and considerably lower
the average interest rate on its remunerated debt.
7.2. Consolidation peri meter
For the first time, sales exceeded €600 million to reach €604.8
million, an increase of 7.9% on the €560.3 million registered in 2014.
Sales growth in the fourth quarter (8.6%) was higher than the annual
average despite a weaker exchange rate advantage.
About half of the €44 million increase in sales is estimated to have
resulted from the exchange rate effect. Excluding this effect, sales
revenue rose by around 4%, a performance almost totally due to an
increase in sales volume.
All BU, except the Floor and Wall Coverings unit, registered an increase
in sales, both in total sales and sales to end-customers. The Floor and
Wall Coverings BU, which in the third quarter succeeded in slightly
reversing a downward sales trend, suffered a further drop in the fourth
quarter, with sales to Russia proving particularly difficult throughout
the year.
The sales performance of the Cork Stopper BU (+9.9%) and the
Composite Cork BU (+17% to end-customers) deserves highlighting.
The strength of the US economy, the focus of the Group’s commercial
teams on the US and the strong appreciation of the US dollar, as
referred to previously, were responsible for a significant part of these
strong growth rates.
The Group’s strong operating performance saw EBITDA exceed €100
million for the first time as it grew 16.1% to €100.7 million.
The EBITDA/sales ratio rose to 16.7%, a notable improvement on the
15.5% recorded in 2014. A drop in the fourth quarter resulted not only
from the weak performance of floor and wall coverings in last three
There not having been any changes in the group of companies that
make up Corticeira Amorim, the financial statements for 2015 are
comparable with those of 2014.
7.3. Consolidated Re sults
Passing the sales milestone of €600 million, as previously mentioned,
resulted from a combination of volume growth and the positive
exchange rate effect. As also mentioned, all BUs, with the exception
of Floor and Wall Coverings, reported significant increases in sales:
End Customers
Cork Stopper BU
+10%
Floor and Wall Coverings BU
-5.2%
Composite Cork BU
+17%
Insulation Cork BU
+4.9%
Consolidated
+7.9%
The Raw Materials BU, about 95% of whose sales are to other BUs,
especially the Cork Stopper BU, also saw its business grow. In line with
the sales growth of its main customer, its sales increased 3.1% without
the advantage of any exchange rate benefit.
41
MDFaçade Wave
Sales by Business Unit
The increase of about €32 million in the gross margin (sales plus
production variations less the cost of incorporated materials) reflected
a small percentage gain. In spite of using slightly higher-priced cork
from the 2014 purchasing campaign, the Group was able to report
an improvement in this important ratio. The absolute value totalled
€315.6 million.
64.2%
The increase in business activity and the exchange rate effect, especially
at the Group’s four US units, had significant upward impact on operating
costs (excluding depreciations and amortisations).
17.8%
15.4%
1.4%
1.2%
Cork Stoppers
Insulation Cork
Floor and Wall Coverings
Raw Materials
Composite Cork
In regard to markets, the US strengthened its position as the Group’s
most important sales destination. As previously mentioned, this
improvement was not wholly a result of the exchange rate effect.
Volume growth, the sales mix and a continuous effort to take the
best advantage of such a strong market have also contributed to the
growing importance of the US. The activities of the Cork Stopper and
Composite Cork BU clearly reflect the advantages of the US market.
Sales by Geographical Area
21.7%
54.4%
EU*
Portugal
USA
7.6%
5.8%
5%
4%
1.6%
Rest of America
Rest of Europe
Australasia
Africa
* It includes Switzerland and Norway and excludes Portugal.
Sales to non-Group Clients.
42
The increase of about of €18 million in operating costs (a 9.2% increase on
2014, of which about 2% was due to the exchange rate effect) reflected
a sharp increase in staff costs. As well as reflecting the exchange-rate
effect referred to above, the €8M increase in staff costs also resulted
from an increase in the average number of workers (an additional 139
workers, representing an increase of 4%). In spite of a reduction in
the number of employees at the Floor and Wall Coverings BU, aimed
at adjusting the workforce to a drop in business volume, the Cork
Stopper and Composite Cork BUs reported significant increases in their
headcounts. The increase in the number of workers at Composite Cork
BU partly reflected the need to meet an important order placed by a
well-known international distribution chain, which required the hiring
of a large number of workers. Part of the increase also reflects some
overlapping of cork rubber production at the Corroios and Mozelos
plants, which was only corrected at the end of the year. Increased
business activity at the Cork Stopper BU required some increase in
the number of workers, especially in the production of Top Series
stoppers. The growth in employee numbers was also influenced by
internalising previously subcontracted work, the costs being transferred
to staff expenditure.
The 4% increase in spending on suppliers and services was in line with
the increase in business volumes. A significant increase in spending
on research and development projects that cannot be capitalised
contributed to the increase in this cost item. One example of this was
the one-off cost involved in developing the ND Tech project, which
was not eligible for capitalisation.
A natural increase in commission, transport and energy costs also
contributed to the increase in supplier and services costs.
In 2015, projects aimed at improving operating efficiency could not all be
translated into reductions in operating costs. Following the conclusion
and start-up of these projects, the benefits of these projects should, in
2016, produce the returns that it was not possible to achieve in 2015.
Registering costs that involved no cash outlay also impacted operating
costs. The adoption of more demanding criteria for registering
impairments on customers’ overdue balances and on inventories
from which there have been no sales for a determined period led to
an increase of about €4.3 million in these costs. The total increase in
impairment costs was €3 million.
The unfavourable change of about of €2.2 million in other gains and
operating costs resulted from a lower recognition of gains from
investment grants and from exchange rate differences relating to
accounts receivable.
EBITDA exceeded €100 million to reach a total of €100.7 million, a
16% increase on 2014.
The EBITDA/sales ratio rose to 16.7%, a notable improvement on the
15.5% registered in 2014.
As mentioned in the summary of activities, performance in the fourth
quarter was affected by weak sales of floor and wall coverings. Compared
with the previous quarters, when performance was already considerable
below potential, EBITDA at this BU fell by about €2 million in the last
three months of 2015. As noted previously, an especially high level of
impairments was also registered in the last quarter. As a result, the
EBITDA/sales ratio for this period was 14.5%.
EBITDA : BU Contribution
Cork Stoppers
As reported in the segment report, EBITDA at the Cork Stopper and
Composite Cork BUs evolved positively, but it fell at the Floor and
Wall Coverings and Insulation Cork BUs. At the Raw Materials BU, the
decrease reflected the use of cork purchased in 2014 at a higher price.
Finally, the combined EBITDA/sale ratio for the Raw Materials and Cork
Stoppers rose from 17.7% in 2014 to 19.9% in 2015, a clear indication of
the strength of this business within Corticeira Amorim.
EBITDA/Sales Ratio
2014
2015
The Raw Materials BU
13.3%
12.5%
Cork Stopper BU
13.1%
16.0%
Cork Stopper + Raw Materials BUs
17.7%
19.9%
Floor and Wall Coverings BU
13.3%
7.4%
Composite Cork BU
9.2%
14.6%
Insulation Cork BU
16.5%
12.4%
Consolidated
15.5%
16.7%
(thousands euros)
62,753
Raw Materials
16,988
Insulation Cork
1,241
Floor and Wall Coverings
8,173
Composite Cork
14,585
Other
3,020
EBITDA consolidated
100,720
43
EBIT totalled €75.7 million, an increase of 17.5% that was in line with the growth in EBITDA.
A one-off gain of €2.9 million relating to an impairment of goodwill was registered, reducing
this item to zero in the balance sheet.
Financial results improved successively in each quarter. Interest paid in 2015 totalled €2.1 million,
almost half the amount paid in 2014. Interest paid in the fourth quarter totalled €0.4 million,
reflecting a notable reduction in interest costs over the year.
Income from associated companies also performed positively. Profits from companies in which
Corticeira Amorim does not own a majority holding totalled €3.1 million, a substantial increase
on the €1.3 million registered in 2014.
As mentioned in the summary of activities, this increase reflected the strong performance
of Trescases and Corchos of Argentina (Cork Stoppers BU) and US Floors (Floor and Wall
Coverings BU).
Provisions made for new tax processes did not affect tax on earnings. The positive impact of
this was further enhanced by the favourable outcome of two tax cases, one of them dating
back to 1994!
Fiscal benefits were, as usual, calculated in the fourth quarter. In spite of the prudence with which
benefits were accounted for, the increase in relation to 2014 was an additional contribution to
the lower tax burden registered 2015.
After estimated corporation tax of €17.5 million and the appropriation of €0.6 million in
earnings for minority interests, Corticeira Amorim’s net profit for 2015 rose to €55.012 million,
an increase of 53.9% on the €35.756 million reported for 2014.
Net profit in the fourth quarter totalled €13.402 million, almost double the earnings achieved
in the same period of 2014.
Composition of Net Profit
(thousands euros)
EBITDA
Depreciations
100,720
25,051
Non-current costs
Interests and other financial costs
(Gains) / Losses of Associates
2,904
2,789
3,091
Tax
17,496
Non-controlling interests
558
Net Profit
44
55,012
8
CONSOLIDATED
DEMONSTRATION
OF THE FINANCIAL
POSITION
For a better understanding of the balance sheet, it should be noted
that in mid-September Corticeira Amorim disposed of all the own
shares that had for a long period been held in its portfolio. This
operation took the form of a private placement for sale of 7,399,262
shares representing 5.56% of the company’s share capital at a price
of €4.45 per share. The sale raised €32.9 million gross. Given that this
was a transaction that involved shareholders, without any change in
the control of the company, the accounting gain from the sale was
registered directly as equity (€25.7 million).
The balance sheet totalled €667 million, an increase of about of €50
million compared with the end of 2014. Operating items accounted
for most of the increase in asset value. In fact, the increase in business
activities, the impact of exchange rate conversion on the assets of
non-euro subsidiaries, especially the four US units, accounted for
a large part of the overall increase. The increase in inventories and
customers alone totalled €34 million. The increase of about €9 million
in tangible and non-tangible fixed assets also helps explain the overall
increase in the value of assets.
Net remunerated debt fell by about €4 million to €83.9 million, a
reduction that could have been larger. The expected allocation of
resources to operating items (customers and inventories) was only
partially compensated for by the increase in the suppliers account.
However, payments of about of €5 million made in December relating
to investments expected to be made at a later date prevented a bigger
reduction in remunerated debt at the end of the year.
An increase of about €40 million in equity compensated for the
increase in assets.
In spite of the significant increase in assets, the financial autonomy
ratio increased from 51.1% at the end of 2014 to 53.1% at the end of 2015.
The operations relating to the sale of own shares, dividends distributed in
2015 and EIB loan agreement are described in the summary of activities.
Mater ia , cork by A morim , curated by Experimentades ign
45
9
main
COnsOLiDaTeD
FigUres
2015
2014
Variation
4Q15
4Q14
Variation
Sales
604,800
560,340
7.9%
141,911
130,655
8.6%
Gross Margin – Value
315,613
283,583
11.3%
73,274
70,457
4.0%
50.7%
49.8%
+ 0.9 p.p.
50.4%
50.5%
+ 0.07 p.p.
Operating Costs – current
239,944
219,197
9.5%
59,046
55,468
6.4%
EBITDA – current
100,720
86,722
16.1%
20,565
20,639
- 0.4%
EBITDA/Sales
16.7%
15.5%
+ 1.2 p.p.
14.5%
15.8%
+ 1.31 p.p.
EBIT – current
75,669
64,386
17.5%
14,229
14,990
5.1%
2,904
6,354
–
-3
2,840
–
55,012
35,756
53.9%
13,402
6,722
99.4%
0.431
0.285
51.3%
0.101
0.054
88.3%
83,896
87,558
- 3,662
–
–
–
1)
Non–current costs
2)
Net Income
Earnings per share
Net Bank Debt
Net Bank Debt/EBITDA (x)
3)
0.83
1.01
- 0.18 x
–
–
–
EBITDA/Net Interest (x)
4)
70.5
30.8
39.71 x
74.9
38.2
36.67 x
Equity/Net Assets
5)
53.1%
51.1%
+ 2.0 p.p.
–
–
–
1) Rel ated to Pro duc tion
2) Go odwill impair ment and industrial restruc t uring
3) Current EBI TDA o f the l ast four quarter s
4) Ne t interest includes interest from loans deduc ted of interest
from dep osits (excludes stamp ta x and commissi ons)
46
10
THE ACTIVITIES OF Corticeira
Amorim’S NON-EXECUTIVE
BOARD MEMBERS
In accordance with Portugal’s Corporate Governance Act (Código
do Governo Societário), which sets out the recommendations of the
Security Markets Commission (CMVM) on corporate structure and
governance, Corticeira Amorim provides the following information
on the activities of its non-executive board members.
During 2015, the non-executive members of the Board of Directors
regularly attended the monthly meetings of the Board, where all
matters that could not be delegated or were included on the agenda
because of their importance, scale or critical timing were discussed
and analysed.
The meetings were organised administratively to ensure that all board
members, executive and non-executive, could adequately prepare
beforehand, encouraging the active participation of all members
in the debate, analysis and tabling of decisions in benefit of the
productivity of the meetings and the efficiency of the Group. The
calendar of ordinary meetings of the Board of Directors was agreed
at the beginning of 2015 to enable all members to attend. Any board
member, including non-executive members, could submit points or
discussion subjects for inclusion in the agenda up to two working days
before each meeting.
A system has been implemented that enables the Executive Board to
report to the Board of Directors in such a way as to ensure that the
activities of the two bodies are properly aligned and that all members of
the Board of Directors are informed in a timely fashion of the activities
undertaken by the Executive Board.
As a consequence, and excepting matters that are of the exclusive
competence of the Board of Directors, non-executive board members
were informed of and able to follow:
×× the development of operating activities and the main economic
and financial indicators of all the BUs that comprise Corticeira
Amorim;
×× information relation to the Group’s consolidated finances:
financing, investment, financial autonomy and extra-patrimonial
responsibilities;
×× activities carried out by different support services and their
impact on the Group;
×× the development of IR&D activities;
×× the calendar of the main events involving Corticeira Amorim
and its BU, given that the Group is often represented at
international events, such as trade missions, by one or more
non-executive member of the Board of Directors.
Wicanders, Hydrocork
47
11
FUTURE
PERSPECTIVES
11.1. Macroeconomic Conditions
11.1.1. Global Outlook
In 2016, the World Economy is expected to grow at a faster pace than
in 2015, at around 3.4%. It is significant, however, that the IMF has
made three downward revisions of its growth forecast for 2016 in less
than a year, pointing to a slowdown, the rebalancing of the Chinese
economy and the fall in commodity prices as important factors.
Growth in emerging economies is projected to recover at a more
gradual pace. International trade is likely to expand at a slower rate;
lower global demand and excess supply will be reflected in maritime
freight rates; it is feared that commodity prices will continue to fall
sharply and take a long time to recover, penalising producer countries,
almost all of which are emerging economies, and forcing significant
economic adjustments. Brazil and Russia are likely to be particularly
badly affected. Developed economies are expected to lead economic
growth, continuing the trend of recent years. The slowdown in China,
resulting from changes currently underway in the country’s growth
model (and the countless challenges this process involves) will have
a significant impact, hitting hardest the economies most dependent
on trade with China. Faced with this prospect, the market is looking
towards the US as an alternative engine of world growth.
The economic outlook is dominated by expectations of an increase
in US interest rates and deflationary pressures resulting from lower
levels of business activity and the fall in commodity prices, especially
oil. The risks to world growth, which also include geopolitical tensions,
instability and risk aversion in financial markets, are significant. The
climate in the US will be dominated by the presidential election on
November 8, while the debate over Britain’s membership of the EU
and migratory flows are the most critical challenges facing Europe.
The broad global impact of a sharper slowdown than forecast in China
and a rapid and unexpected increase in risk aversion are among other
risks that could affect forecast trends in 2016.
The Euro Zone will face several challenges in 2016 – the slowdown in
emerging markets with has a direct impact on the European export
sector; the challenge of the UK’s “Brexit” referendum and the continuing negotiations around that issue; the need for European banks to
strengthen their capital ratios and bad debt management, together
with the new rules set out in the EU’s Bank Recovery and Resolution
Directive; the threat of extreme events such as terrorist attacks; and,
above all, the flow of migrants to Europe and the integration of refugees.
Political cohesion and the response of public services responsible for
integrating refugees into society and the labour market will be critical
in this regard. It is nevertheless estimated that the European economy
will grow at a faster pace than in 2015, at about 1.7%, supported by
stronger domestic demand. The ECB will act to keep monetary policy
highly accommodating – “lower for longer” – focusing on asset
purchasing programmes (quantitative easing) and increasing the use
unorthodox measures, such as negative absorption rates. It will use
these measures to combat increasing downward pressures on prices
and future inflation expectations and to achieve price stability by
eliminating the gap between actual inflation levels and its mandatory
inflation target. The labour market should continue to improve as it
has in recent years, but as has so far been the case, at a pace too low to
48
produce a sharp drop in unemployment rates. The average EU jobless
rate is expected to drop to 10.5% (compared with 7.5% before the 2008
crisis). In the run-up to the US president election, the selection of
candidates by the competing parties and their positions on sensitive
world economic issues are likely to generate some degree of volatility.
The US economy should perform strongly in 2016, although below the
level that had been forecast not long ago – a consolidation of growth
rather than an increase in momentum. Growth is expected to be close
to 2.5%, supported by increased consumption. The labour market
should continue to perform extremely positively, as it did in 2015, and
the real estate market should continue to expand. The Industrial sector
is likely to show signs of slowing down, a trend common to numerous
economies across the world; it is feared the sharp fall in the price of
energy inputs will lead to a contraction of investment in oil prospecting,
affecting some segments of the financial markets. Inflation trends in
2016 will depend on the impact of the US dollar on import prices and
on the extent to which the impact of lower energy prices dissipates;
labour market trends are likely to lead to wage pressures, leading to
projected inflation of about 1.8%. Having started a cycle of monetary
normalisation in December 2015, the Federal Reserve is expected to
raise interest rates at a slow and gradual pace. Monetary conditions
will remain highly accommodating.
The UK will hold a referendum on its membership of the EU. It will
take place on June 23 and could cause some instability given the real
possibility of Britain leaving the EU. This uncertainty will dominate
the outlook for the UK and could affect economic trends. Growth
will continue to be supported by private consumption and by the
continuation of favourable monetary conditions.
The performance of the Japanese economy is expected to improve
in 2016 in spite of the difficulties the country faces in implementing
more structural measures. Growth is expected to find support in an
ultra-expansionist monetary policy, a favourable fiscal context and
the fall in energy prices. Consumption and investment should make
a larger contribution to growth. The Japanese economy is expected
to expand by about 1%.
Australia, sensitive to trends in China, should register economic
growth marginally above 2%.
As in 2015, the pace of economic growth is decelerating in China, the
world’s second largest economy. The 2016 growth rate is forecast at
around 6%, which would be the lowest annual rate of expansion for
the past 26 years. China faces significant challenges relating to the
process of rebalancing its economy, investment in consumption,
external demand as the motor of growth in domestic consumption
and, in sectorial terms, its service industries. Managing the opening
of financial markets, and thus giving primacy to prices defined by
the market, and the evolution of the yuan (CNY), will be critical. The
Chinese authorities are expected to focus their attention on excess
credit, installed industrial capacity and real estate trends.
Among the BRIC economies, India is likely to be the only country to
see economic growth accelerate in 2016, reaching an expected growth
rate of around 7.5%. The economic performances of Brazil and Russia
are likely to prove disappointing for a third consecutive year – the
economies of both countries being expected to contract, especially,
it is feared, in Brazil. Both face a growing dilemma in regard to their
economic and monetary policies – with economic growth becoming
increasingly doubtful while inflation rises sharply. The credibility of the
monetary authorities in these countries will be crucial in this regard.
Elections to the Duma, the lower house the Russian Federation’s
parliament, will be held on September 18.
South Africa should experience a significant slowdown, with economic
growth expected to drop to 0.7% in 2016, down from 1.3% in 2015. The
main challenges are likely to be structural problems and a weakening
of international confidence.
11.1.2.Portugal
In 2016, Portugal is forecast to register economic growth of around
1.7%, marginally higher than in 2014, but in line with projections for
the Euro Zone average. The Portuguese economy faces increasing
challenges, beginning with the performance of its main export markets,
such as Spain, which has been experiencing political uncertainty
since December, as well as markets that have become increasingly
important to Portugal in recent years, such as Angola. However, the
positive outlook for the German economy could prove a compensatory
factor for Portugal. The impact of interventions in the banking sector
(in December 2015) on public accounts and international credibility
(due to the reversal of previous measures) are aspects that could
affect Portugal’s country risk premium and future levels of economic
activity. Alarm signals and expressions of the concern by international
institutions were at a peak at the end of 2015 and during the first weeks
of 2016. These are indications that the Portuguese authorities should
not underestimate, on pain of weakening the country’s economic
recovery and international credibility. In 2016, Portugal is unlikely to
be able to remove the country from external oversight under EU’s
excessive deficit procedures.
Growth, however, is likely to be more balanced than in 2015, with
domestic demand contributing positively (increasing by a projected
1.8%), while net exports are likely to make only a slightly positive or
zero contribution. In spite of an expected increase in disposable family
income, private consumption should increase at a slower pace than in
2015, largely due to stronger growth in savings. The current account
balance should remain in surplus, at around 0.5% of GDP, providing a
positive basis for financing the economy. The political choices made
by the government will have a different impact on the consolidation
of public accounts and the debt-to-GDP ratio than had previously
been expected. In contrast to recent years, public consumption will
increase, the budget deficit will be reduced at a more moderate pace
and public debt is unlikely to fall significantly. After significant and
unexpected growth in 2015, especially in the first half, investment is
expected to increase at a slower pace, reflecting a drop in external
demand and a stabilisation in utilised production capacity at close to
the historic average. Inflation is forecast at around 1%, although it is
estimated that the continuing fall in energy prices and more moderate
growth in business activity could result in downward pressure on prices.
Unemployment should continue to fall at the same moderate pace of
the previous year to 11%-12%.
11.2. Operational Activitie s
11.2.1. Raw Materials
The outlook for 2016 in terms of business activity differs little from that
of 2015. Provided the needs of the Group’s value chain remain at the
same level, the profitability of the BU’s units in the Iberian Peninsula
will remain at similar levels to those of 2015. The unit in Morocco is
expected to suffer a drop in profitability resulting from the purchase
price of cork acquired in 2015.
Starting 2016 with a balanced level of stocks tailored to meet demand
from Group companies means the BU can focus on achieving the
best price/quality ratio in its non-virgin cork purchasing campaign,
seeking at the time of purchase to acquire batches with the required
sensorial characteristics.
In terms of operating efficiency, the BU will continue to implement
rigorous plans for rationalising operating costs that apply to all its
production units and to develop projects aimed at improving industrial
processes.
At the units producing discs for champagne and Twin Top stoppers,
2016 will be a year for consolidating investments made in previous
years, the units having already reached a notable level of efficiency.
Lengthy work is still required in the area of cork preparation, focusing
on researching new solutions to help make these labour-intensive
processes more efficient.
In 2016, the BU also aims to reduce the amount of capital invested in
stocks of finished products and products in the process of production by
changing planning methods, introducing more rigour into production
processes and adopting new decontamination methods.
11.2.2. Cork Stopper
Up to 2018, US demand is expected to drive the growth of the world
wine market, which is forecast to expand by about 11% between 2014
and 2018 to 4.5 billion bottles.
The growth rate of Chinese wine consumption is projected to drop
from 69% to 25% to an estimated total of 2.2 billion bottles in 2018.
Bote , by Nendo for Mater ia collect ion
49
Demand for sparkling wines and rosés will be a global market driver,
while the deceleration of the Chinese economy and government
repression of abusive consumption of high value drinks will see the
US resume its role as the main engine of world growth. As a result,
the US is forecast to become the world’s biggest consumer of wine by
2018, ahead of France, Italy, Germany and China, including Hong Kong.
Over the same period, per capita consumption is expected to fall in
Italy, France, Switzerland and Portugal, while countries such as Austria
and Greece could register a slight increase.
As a result of these trends, by 2018 the Asia-Pacific region’s share of
world wine consumption will have increased from 11% to 12%; Europe
will account for 61%, the US, Canada and Latin America for 24% and
Africa and the Middle East for 3%.
In 2016, the challenge for this BU will be to maintain profitability levels
by means of more efficient management of the capital invested in the
business. In particular, more efficient ways of controlling the supply
chain will be implemented, as well as better ways of controlling credit
in poorly-regulated markets with a view to increasing the rotation of
working capital.
The BU will remain focused on improving its products and services as
a means of increasing market share.
It is imperative that the BU consolidates and defends its market position,
broadens its customer base and improves it customer retention rate.
It also needs to gain market positions for alternative products based
on their sustainability and product reliability.
In the context, the Cork Stopper BU’s priorities will be:
×× to develop and promote a differentiated product portfolio
with the aim of creating and optimising value;
×× to launch disruptive products that meet the needs of endconsumers;
×× to focus on sales of ND Tech, Helix and Twin Top Evo stoppers;
×× to strengthen the skills base so that the Cork Stopper BU is
perceived by its customers as their best business partner;
×× to enhance the business of supplying direct customers in
Portugal by providing the same level of quality and service
at a lower cost;
×× to improve supply chain management with a view to cutting
costs, reducing the amount of invested capital and improving
service levels;
×× to continue aligning suppliers with the best practices of the
Group’s raw material value chain;
×× to focus, in the industrial area, on sensorial qualities and
product homogeneity;
×× to prioritise operating efficiency and technological improvement
projects likely to have a significant impact;
×× to strengthen competitiveness by leading in operating efficiency
and adjusting the BU’s cost structure to the margin it generates;
×× to build a team development programme to enhance the BU’s
customer and market culture;
×× to extend training, cork knowhow and an understanding of
the BU’s business model to every employee;
×× to consolidate the BU’s sustainability policy and practices; and
50
×× to strengthen partnerships and gain new sources of knowledge.
11.2.3. Floor and Wall Covering
Projected sales for the Floor and Wall Coverings BU in 2016 are based
on the success of new products featuring differentiating factors thanks
to the technologies used in creating their look as well as new finishes
and dimensions in tune with modern trends.
Particularly noteworthy was the launch of the AUTHENTICA range
at Domotex 2016. This floating flooring improves on the advantages
of CORKTECH by using more cork in its production. It also has the
advantage of combining ecological efficiency and flexibility with
improved thermal and insulation performance.
In addition, the introduction of new looks for the BU’s products,
multiplying the variety of unique looks available, will help it to fulfil
customer requirements more effectively.
Following the BU’s revaluation of the growth aspects of its new strategic
performance cycle, a number of opportunities were identified in
priority markets. Focusing the management team and strengthening
commercial capacity will be crucial factors in this growth strategy.
The BU has been focusing on the development of areas that have been
identified as priority markets, always taking into account changing
factors that could in some way affect this classification, particularly
by identifying new opportunities as they arise.
In parallel with its commercial development activities, important
initiatives aimed at preparing the BU for a new industrial approach will
be consolidated in 2016, with the aim of maintaining the BU’s dynamism
in the competitive environment that characterises the flooring industry.
Performance in 2016 will benefit from consolidating the gains made in
2014/2015 in low-profit markets by gaining and keeping new customers,
energising relationships with existing customers on the basis of their
potential and taking advantage of the full range of products available
in the BU’s portfolio.
In regional terms, East Europe will be a priority market, taking into
account the need to rebuild sales through a new commercial approach
and by promoting the brand that consolidates the BU’s presence in
this market.
Innovation will continue to be one of the main pillars for developing
the competitive advantages of the Floor and Wall Coverings BU. New
products that will strengthen its leadership of the sector are due to be
launched, ensuring that the products and services the unit introduces
onto the market maintain the high value offering that differentiates
the BU from its competitors.
11.2.4. Composite Cork
The Composite Cork BU is optimistic about 2016, when it expects to
consolidate and improve on its strong performance in 2015.
From the commercial point of view, the launch pad for the year is a
new approach to markets and a new organisational structure designed
to meet the challenges the BU faces.
The outlook for the construction segment is positive. Plans are in place
for the launch of new products developed in recent months and for
broadening the geographical scope of market segments that have
traditionally been concentrated in Europe.
The outlook for the industrial and retail segments is also encouraging,
especially in regard to the expected impact of giving market segments
that are concentrated geographically a more global reach. This
will be supported by the BU’s new commercial organisation, which
complements regional sales responsibilities with global management
of market segments and value offerings.
Cork Oak Tree
The BU should achieve higher levels of operating efficiency than in
2015 as a result of concentrating production at a single location in
Portugal, as well as benefitting from other important initiatives currently
underway that will reduce costs and improve customer service levels.
Focusing on priority segments and regions and the introduction of
new products onto the market will continue to be the main engines
of growth. The BU also plans to optimise commercial customer
management to maximise potential and foster value creation.
In total alignment with this strategy, the BU will also develop and
implement a digital marketing plan to advance and promote the
singularity of cork among stakeholders.
Customer satisfaction will play an even more central role in the BU’s
strategy. Maximising potential in this area will naturally require higher
service levels, building on the rationalisation of the BU’s product range
opportunely communicated to the market.
A constant search for more efficient use of resources will continue to
be a management priority, especially in areas such as energy and the
use of raw materials.
Priorities for 2016 for creating the right conditions for continued
success are clearly defined and cover a range of areas:
×× in the area of human capital, the priority will be to upgrade
the skills of people working in the commercial areas and in
innovation;
×× in the industrial area, a deeper analysis will be made of the
organisational structure, processes, systems and staff in the
areas of production, maintenance, logistics, infrastructures,
quality, hygiene and safety;
×× a strategic reflection will be undertaken on the impact of
world trends that will affect the whole industry in coming
years, namely automatisation, robotisation, digitalisation and
artificial intelligence;
×× in regard to partnerships, the goal will be to make the necessary
adjustments to consolidate existing partnerships and to forge
new partnerships in priority markets and segments;
51
×× the theme of innovation is crucial, consequently the implementation of the process designed in 2015 (I-Cork System)
will be strengthened to ensure that innovation is continuous
and systematic.
11.2.5. Insulation Cork
In 2016, the Insulation Cork BU expects volume sales to grow in the
expanded cork conglomerate segment, reflecting a recovery in the
overall market and an expansion in emerging markets, even though
there have been no consistent indications of a rapid recovery in the
world economy, especially not in Europe.
The BU will continue to focus on highlighting the technical and ecological
advantages of its products, concentrating on the regions and cultures
that are most sensitive to environmental concerns.
It will maintain industrial flexibility and product versatility, focusing on
specific applications and on responding to special project requests,
as well as on complementing other insulation solutions. The unique
characteristics of the products and solutions marketed by the BU – their
superior performance and their natural and environmentally-friendly
qualities, as well as a focus on new expanded cork conglomerate
applications for external walls and the use of insulation products in
building renovation, will help the BU achieve greater visibility and
expand its position in the market.
The implementation of a number of initiatives and projects in line with
the BU’s global strategy will help it achieve its objective of profitable
growth for the BU’s range of products and to optimise the capital
invested in its business.
11.3. Re sults
Although the forecasts published by the IMF project a higher rate of
world growth in 2016 than in 2015, the events witnessed at the end of
January and during the first days of February are cause for concern.
If several markets do experience a fall, Corticeira Amorim could face
a more difficult year than the one that has recently ended. As always,
special mention should be made of the exchange-rate risk resulting
from the Group’s exposure to the US dollar. The recent drop in the
value of this currency could be an indication that the cycle of dollar
appreciation has come to an end.
The Cork Stopper BU is forecasted to continue mirroring the growth
of the wine, sparkling wine and spirits markets and a solid foundation
is in place for it do so: a diversified range of products of superior and
consistent quality and performance; continuous improvement and
development of its product portfolio; and a dynamic commercial
network that is active in every market. The challenge will be to increase
market share by expanding the customer base and improving customer
retention rates as well as by gaining market positions for alternative
products based on their sustainability and product reliability.
The Composite Cork BU has taken on the challenge of improving on
its excellent performance in 2015. Thanks to organisational changes
introduced in 2015, the BU has the benefit of a new vision and a new
structure for following markets where new products and solutions
designed for growth segments can be successfully placed, such as
construction and retail as well as more diversified and demanding
technical areas. Another goal for 2016 is regional diversification of sales.
The BU will also benefit from a new increase in operating efficiency,
thanks to important initiatives currently underway that will reduce
production costs and improve customer service levels.
The Floor and Wall Coverings BU will work to find alternatives to
the Russia market and definitively to establish Hydrocork as its new
flagship product. Recent development of its range of products and
solutions will help the BU to meet customer needs more effectively.
The technical performance, convenience and sustainability credentials
of the BU’s products will enable it to face with optimism the challenge
of increasing its business volume, particularly in its priority markets.
52
Cork Planks
12
BUSINESS RISKS AND
UNCERTAINTIES
During the Company’s long history, which already encompasses three
centuries, it has successfully coped with deep, sometimes radical
transformations in society and come through two world wars. Through
this history, Corticeira Amorim has accurately and in a timely manner
identified the risks and uncertainties associated with its business and
faced them with confidence as challenges and opportunities.
The difficulties that some of the world’s largest economies are undergoing, particularly the current instability affecting Eastern Europe and
Russia, continue to affect the development of the global economy.
Like other businesses, Corticeira Amorim operates in an uncertain
economic climate that continues to affect some of its main export
markets:
stoppers without, however, need a corkscrew to open the
bottles. It is hoped that this kind of innovation enables the
consumption of the target wine of this product, of greater
rotation, boosting the fractional consumption without loss
of quality. On the other hand, the launch during 2016 of
ND Tech technology of individual detection will be a clear
strengthening of the perception of quality of wines sealed
with Amorim products.
Over the long term, Corticeira Amorim’s performance could also be
influenced by the following factors, which are permanently monitored
and assessed:
I. Exchange rate volatility – a factor that may erode business
margins. Over the short term, the effects of exchange rate
volatility have been offset by an active policy of substituting
invoicing currencies – in 2015 consolidated sales in non-Euro
currencies represented 33% of sales to companies outside
the Group – and by adopting a consistent policy of hedging
exchange rate risk (either through natural hedging or appropriate financial instruments); over the long term Corticeira
Amorim is committed to developing new products/solutions
with greater added value to establish a product mix capable
of overcoming these limitations. As a result, the company has
adopted an organisational model geared to moving up the
value chain and neutralising this risk;
I. The construction sector – the marked slowdown of activity in
this sector, in terms of new building and renovation, as well as
the postponement of purchase decisions by final consumers,
has led to a deceleration in global demand for construction
materials, including floor and wall coverings and thermal and
acoustic insulation.
We will continue to offset this global slowdown by tapping
growth opportunities, strengthening our presence in emerging
markets we have already identified as having high growth
potential and increasing our share of more mature markets.
These opportunities will also benefit significantly from the
launch of new product collections and the development
of a portfolio of products designed to expand the range of
solutions the Group produces.
A growing awareness among final consumers of the importance
of sustainability will also favour the choice of cork for floor and
wall coverings, constituting an important driver of sales growth.
II. The world wine sector – the possibility of a recovery in
consumption per capita in key European Union countries
such as France, Spain and Italy remains questionable. In fact,
wine consumption in some of these large wine-producing and
wine-consuming countries is undergoing a slight decline. On
the other hand, the US maintains a significant weight in the
market to which all wine exporters are turning their attention.
Its size and obvious capacity to accommodate premium prices
make the US the key market for energising the future growth
of the wine industry.
Corticeira Amorim continues to implement an R&D policy
that supports the development of a range of cork stoppers
capable of satisfying the requirements of any wine producer in
any market in terms of quality, quantity and price. Today, the
range of products produced by the Cork Stopper BU makes it
feasible for all wine producers to use cork stoppers, benefitting
from their advantages in terms of sustainability, added value
and CO2 retention, factors which remain indisputable product
differentiating factors worldwide. This trend was reinforced
with the launch of the innovative proposal Helix, in which, for
the first time, consumers can enjoy the technical advantages
of sustainability and premium image associated with the cork
Acoust iCork
53
II. Climate change – a factor that could potentially reduce the
availability of raw materials as it could, due to severe droughts,
destabilise the ecosystem on which the cork oak depends,
which would threaten the propagation and growth of the tree.
More importantly, the capacity of the cork oak and of cork,
both as a raw material and in the form of cork products, to
retain carbon helps to mitigate the emission of the greenhouse
gases that cause climate change. In this respect, a study at
the University of Aveiro, completed in 2015, leaves no doubt
about the important role of the Cork oak and the ecosystem
that surrounds it: for each ton of Cork produced, cork oak
forests (montado) sinks more than 73 tons of carbon dioxide,
equivalent to the emissions of this gas released to go about
450,000 kilometers by car.
The cork oak is the basis of an ecological system that is unique
in the world, contributing to the survival of many species of
indigenous fauna and to the protection of the environment.
The tree is only to be found in seven countries in the western
Mediterranean basin – Portugal, Spain, France, Italy, Morocco,
Algeria and Tunisia – where it acts as a barrier against the
advance of desertification, as it can survive in dry climates
with little rainfall, helping to fix soil and organic material,
reducing erosion and increasing water retention.
Corticeira Amorim products are also important absorbers
of carbon, which they retain until the end of their useful life.
As suggested by the researchers and authors of the study
previously mentioned “the use of cork products contributes to
climate change mitigation, both by its capacity to accumulate
the carbon and by its ability to replace alternative products
more energy-intensive”.
The industrial processing of cork harvested from cork oaks is
the best way to guarantee the preservation and development
of the montado (a sustainable agricultural system based around
cork oak estates) and to ensure their economic viability.
Montados have today become a focus of attention. Specific
legislation to protect them has been approved and several
non-governmental organisations that seek to protect forests
have devised programmes aimed at improving and certifying
forest management practices.
The fixation of CO2 and the increased use of cork for thermal
insulation as eco-construction develops will create an opportunity for highlighting the unique advantages of cork products.
III.The development of alternative closures – the tendency
of wine producers to reduce the use of alternative closures
continued in 2015 with regard to plastic stoppers. With regard
of the screwcaps there was a reduction in the rate of growth
of these artificial closures. On the other hand, market data
produced by Nielsen continued to show that of the 100 leading
wine brands in the US, those using cork stoppers enjoy faster
sales growth than those using artificial closures. According to a
report published by the US Cork Quality Council, US consumers
are prepared to pay 4.20 USD more for a bottle of wine sealed
with a cork stopper. Cork continues to strengthen its role as
a prime stopper and benchmarking in critical factors such as
quality, performance and image; since 2010, it has increased its
penetration in the world’s largest wine market to a 50% stake.
However, artificial closure manufacturers have sought to
find formulas more consistent with the micro-oxygenation
requirements of wine producers. While these efforts remained
largely unsuccessful, in 2015 plastic closure manufacturers
continued to look for alternative raw materials to oil, efforts
to which some wine producers were receptive. In spite of
these efforts, plastic closures continue to be associated with
low-grade wine and lower levels of profitability for producers
and distributors. Screw-cap closures remain limited by the
following factors:
×× the phenomenon of reduction remains an important
technical question. But liners have been introduced
for these closures, aimed at preventing oxygen from
entering bottles;
×× in terms of market share gains, the pace of growth in
screw-top sales may have increased slightly, although
the promotional campaign launched in 2012 still
doesn’t have a visible impact on perception of the
public in what relates to screw-cap closures. It is
therefore cost, more than image or performance,
that is benefitting screw-caps;
CORK STOPPER S INDUSTR IAL PRODUC T ION
54
×× Although the crisis of 2008 may have slightly diminished
awareness of the environmental and ecological costs
involved in the use of manufactured products, there
has lately been a growing understanding of this fact.
This awareness has now become an irreversible reality,
requiring these costs to be mediated and controlled;
During 2015, the Portuguese Cork Association (APCOR)
concluded its a second multi-year campaign to promote
cork internationally, focusing on crucial markets with high
growth potential including the US, Germany, France, China
and Italy. During 2016 it is expected the release of the third
campaign by APCOR.
13
TREASURY
STOCKS
IV.The development of composites materials – the discovery
of new material properties or new methods for transforming,
producing or combining materials can result in new composite
materials with properties that may offer competitive advantages
to Corticeira Amorim, especially its Composite Cork BU, or,
alternatively, to its competitors.
On 16 of September 2015, Corticeira Amorim has launched a private
offer for sale of up to 7,399,262 of its own shares representing up
to 5.56% of its share capital, exclusively addressed to institutional
investors through an accelerated bookbuilding, subject to demand,
price and market conditions (private offer), having the same been
completed that same day.
Thus, in a scenario in which (i) no discoveries in terms of
cork properties or combinations of cork with other materials
resulting in new applications or composite materials capable of
generating new value are made; or (ii) significant advances are
made in developing the properties of competing products (and/
or ways of combining them with other materials) that cannot
be matched by Amorim could have unfavourable consequences
for Corticeira Amorim, such as: a loss of competitiveness in
some business areas and the need to redefine its strategy in
terms of price, equipment and obsolete techniques.
The 7,399,262 shares were sold to institutional investors, at the price
of € 4.45 per share, having the transmission of shares been effected
on 17 September 2015.
In the opposite scenario, in which (i) the discovery of new
properties of cork or complementary materials to cork; (ii)
the discovery of new ways of combining cork with other
materials to create new composites; or (iii) the immunity
of applications using cork to new discoveries by alternative
closure manufacturers would enable Corticeira Amorim, and
particularly its Composite Cork BU, to discover new properties
for existing applications, add value to its products over those of
its competitors, and obtain competitive advantages using new
composite materials enabling it to explore new applications.
A focus on research, development and innovation (RDI)
together with investment in production technology are the
keys to ensuring that the latter scenario materialises and
prevents the former from happening. Increasing awareness
of the value of cork and recognition of its technical and
environmentally-beneficial qualities will benefit that continuous
affirmation of cork on the world stage, an end to which the
promotion of its advantages should also continue.
Corticeira Amorim’s activities are exposed to a range of financial
risks: market risk (including foreign exchange and interest rate risk),
credit risk, liquidity risk and capital risk. Under the terms of line e)
paragraph 5 of article 508C of Portugal’s Commercial Company Code,
the Company’s aims and policies in regard to managing these risks,
including policies for hedging the main foreseeable transactions
for which risk coverage accounting is used, as well as exposure to
price, credit, liquidity and cash flow risks, are duly set out in the
note on “Financial Risk Management” included in the Notes to the
Consolidated Accounts.
There was no other transactions with own shares, as for that, at the
end of 2015, Corticeira Amorim held no own shares.
14
PROPOSED
APROPRIATION
OF PROFIT
Based on the annual financial statements for the year ended 31 December
2015 and in view of the fact that the Company’s net profit for the year
was € 38,182,985.95, the Board of Directors of Corticeira Amorim, S.G.P.S.,
S.A. hereby proposes that the Annual General Meeting considers and
approves a resolution that the above net profit for the year in the
amount of € 38,182,985.95 be appropriated as follows:
×× € 1,909,149.30 to be transferred to the Legal Reserve;
×× € 21,280,000.00 to be allocated to dividend payment, being
€ 0.16 per share; and
×× € 14,993,836.65 to be transferred to Free Reserves.
55
15
17
STATEMENT OF
RESPONSABILITY
FINAL
WORDS
In accordance with line c) of number 1 of article 245 of the Portuguese
Securities Code, the members of the Board of Directors state that, to
the best of their knowledge, the annual accounts and other documents
included in the statement of accounts were drawn up in accordance
with the applicable accounting standards, giving a true and accurate
account of assets and debts, of the financial situation and profits/
losses of Corticeira Amorim, S.G.P.S., S.A. and the companies that
are consolidated by the group. They also state that the management
report faithfully expresses the business evolution, performance and
position of Corticeira Amorim, S.G.P.S., S.A. and the companies that
are consolidated by the group and that the report includes a special
chapter describing the main risks and uncertainties of the company’s
businesses.
16
SUBSEQUENT
EVENTS
The Board of Directors would like to take this opportunity to express
its gratitude to:
×× the Company’s Shareholders and Investors for their unfailing
trust;
×× the Credit institutions with which the Group works for their
invaluable cooperation; and
×× the Supervisory Board and the Statutory Auditor for the rigour
and quality of their work.
To all our Employees, whose willingness and commitment have
contributed so much to the development and growth of the companies
belonging to the Corticeira Amorim Group, we express our appreciation.
Mozelos, February 11, 2016
The Board of Directors of Corticeira Amorim, S.G.P.S., S.A.
Chairman
Vice-Chairman
Member
Subsequent to December 31, 2015 and until the date of this report, there
were no other relevant facts that may have a material adverse effect
on the financial position and future results of Corticeira Amorim and
the subsidiaries included in the consolidation.
Member
Member
Juan Ginesta Viñas
Member
56
Wicanders CorkComfort at the C AP C - Musée d’Art Conte mpora in de Bordeau x
57
Corporate
Governance
Report
03
IntroductIon
CORPORATE
GOVERNANCE
Corticeira Amorim has been reviewing its corporate governance since
1999, the date on which the Portuguese Securities Market Commission
(CMVM) published the first recommendations on the governance of
listed companies, aiming at the improvement of mechanisms for the
protection of investors in securities markets. The Company compares
it with, on the one hand, what are considered best practices, and on
the other, with the circumstances of its activity and the challenges it
has to meet. As a result, it has been implementing a set of measures
which, overall, have the main objectives of strengthening the internal
systems of control and supervision, enhancing transparency, fostering
the participation of shareholders in the life of the company and ensuring
the sustained creation of shareholder value.
This document describes corporate governance policies and practices
adopted by the Company, while also providing a qualitative assessment
of them compared with the best practices listed in the CMVM corporate
governance code.
Section 8 of this report also includes the information referred to
in articles 447 and 448 of the Portuguese Companies’ Code (CSC),
in paragraphs 6 and 7 of article 14 of CMVM Regulation No. 5/2008
(Transactions of Directors) and in article 3 of Law No. 28/2009, of 19
July (Remuneration Policy).
PART I
MANDATORY
INFORMATION ON
SHAREHOLDER
STRUCTURE,
ORGANISATION
AND CORPORATE
GOVERNANCE
Cork oak forest
60
- ANNUAL REP ORT AND ACCOUNTS ‘15 CORTiCEiR A A mORim , S.g.P.S., S. A .
A.
SHAREHOLDER
STRUCTURE
I. Capi tal struct ure
1. The capital structure (share capital, number of shares, distribution of capital by
shareholders, etc.), including an indication of shares that are not admitted to trading,
different classes of shares, rights and duties of same and the capital percentage that each
class represents (Article 245-A/1/a)).
Corticeira Amorim’s share capital amounts to EUR 133 million and is represented by 133 million
ordinary shares for a nominal value of one euro each, and which grant the right to dividends.
All shares issued by the Company are listed on Euronext Lisbon - Sociedade Gestora de
Mercados Regulamentados, S.A.
Distribution of capital among shareholders:
Shareholder
No. of shares owned
(quantity)
Stake
Voting rights
Qualifying interests:
Amorim Capital, S.G.P.S., S.A.
67,830,000
51.000%
51.000%
Investmark Holdings, B.V.
24,975,157
18.778%
18.778%
Amorim International Participations, B.V.
20,064,387
15.086%
15.086%
20,130,456
15.136%
15.136%
133,000,000
100.000%
100.000%
Free float
Total
2. Restrictions on the transfer of shares, such as clauses on consent for disposal, or limits
on the ownership of shares (Article 245-A/1/b)).
There are no restrictions on the transfer of shares.
3. Number of treasury shares, the percentage of share capital that it represents and
corresponding percentage of voting rights that corresponded to treasury shares (Article
245-A/1/a)).
At 17 September 2015, Corticeira Amorim held a treasury stock of 7,399,262 shares, representing
5.563% of its share capital and which would correspond to 5.563% of the voting rights if those
rights had not been suspended pursuant to the provisions of Article 324(1)(a) of the Portuguese
Companies’ Code.
Corticeira Amorim held no treasury stock at 31 December 2015.
4. The disclosures of important agreements to which the company is a party and that come
into effect, amend or terminated in cases such as a change in the control of the company
after a takeover bid, and the respective effects, except where due to their nature, would be
seriously detrimental to the company; this exception does not apply where the company
is specifically required to disclose said information pursuant to other legal requirements
(Article 245-A/1/j)).
At 31 December 2015 there were loan agreements entered into by Corticeira Amorim and
several banking institutions containing covenants requiring the maintenance of Corticeira
Amorim’s controlling interest in contracts regarding loans totalling forty-five million euros.
In the case of change of shareholder control, the contracts provide the possibility - but not
the obligation - of early repayment of the amounts loaned.
There are no other agreements according to the terms set out in this paragraph.
5. A system that is subject to the renewal or withdrawal of countermeasures, particularly
those that provide for a restriction on the number of votes capable of being held or
exercised by only one shareholder individually or together with other shareholders.
CORP OR ATE GOVERNANCE R eport —
61
The Articles of Association of the Company do not include measures of this type and, to the
best knowledge of Corticeira Amorim, there are no other arrangements and/or measures
with that same goal.
6. Shareholders’ agreements that the company is aware of and that may result in restrictions
on the transfer of securities or voting rights (Article 245-A/1/g)).
Corticeira Amorim has no knowledge of the existence of any shareholders’ agreements that
might lead to the aforementioned restrictions.
II. Sharehold ing s and Bonds held
7. Details of the natural or legal persons who, directly or indirectly, are holders of qualifying
interests (Article 245-A/1/c) & /d) and Article 16) with details of the percentage of capital
and votes attributed and the source and causes of the attribution.
Shareholder
No. of shares
(quantity)
Share capital with
voting rights
67,830,000
51.000%
67,830,000
51.000%
–
–
67,830,000
51.000%
67,830,000
51.000%
–
–
67,830,000
51.000%
67,830,000
51.000%
24,975,157
18.778%
24,975,157
18.778%
–
–
24,975,157
18.778%
24,975,157
18.778%
–
–
24,975,157
18.778%
24,975,157
18.778%
20,064,387
15.086%
20,064,387
15.086%
Amorim Capital SGPS, S.A.
Directly
Attributable total
Amorim Investimentos e Participações, SGPS, S.A.
Directly
Through Amorim Capital SGPS, S.A., which holds a 100% interest
Attributable total
Interfamília II, SGPS, S.A.
[a]
Directly
Through Amorim Investimentos e Participações, SGPS, S.A., in which it
holds a 100% interest
Attributable total
Investmark Holding BV
Directly
Attributable total
Warranties, SGPS, S.A.
Directly
Through Investmark Holding BV, in which it holds a 100% interest
Attributable total
Américo Ferreira de Amorim
Directly
Through the shareholder Warranties, SGPS, S.A., in which it holds a 70% interest.
Attributable total
Amorim International Participations, BV
Directly
Attributable total
Amorim, Sociedade Gestora de Participações Sociais, S.A.
[b]
Directly
Through Amorim International Participations BV, in which it holds a 100% interest
Attributable total
a
–
–
20,064,387
15.086%
20,064,387
15.086%
The capital of Interfamília II is wholly owned by three companies (Amorim Holding Financeira, SGPS, S.A. (5.63%),
Amorim Holding II, SGPS, S.A. (44.37%) and Amorim - Sociedade Gestora de Participações Sociais, S.A. (50%))
none of which has a controlling interest in the company. The capital of first two companies is held by Américo
Ferreira de Amorim and by his wife and daughters and the third by António Ferreira de Amorim and by his wife and
children. As far as the Company is aware, there are no agreements between the referred companies for the purpose
of the concerted exercise of the voting rights in Interfamília II, SGPS, S.A.
b
The capital of Amorim, Sociedade Gestora de Participações Sociais, S.A. is held by António Ferreira de Amorim,
by his wife and children, but none of them holds a controlling interest in the company
62
8. A list of the number of shares and bonds held by members of
the management and supervisory boards.
a) Corticeira Amorim shares held and/or traded directly by
members of the governing bodies of the Company:
i. The members of the governing bodies did not trade any
shares representing the share capital of the Company
during the 2015 financial year. At 31 December 2015, they
did not hold any shares in Corticeira Amorim.
b) Corticeira Amorim shares held and/or traded directly by
companies in which the members of the Company’s governing
bodies exercise management or supervisory responsibility:
i. Amorim Capital, SGPS, S.A. in which António Rios de
Amorim, Chairman of the Board of Directors of Corticeira
Amorim, holds the position of Member of the Board of
Directors, did not trade any shares of Corticeira Amorim.
This means that at the end of year he held 67,830,000
shares, representing 51% of the share capital, which correspond to 51% of the voting rights.
ii. Amorim International Participations, BV, in which Cristina
Rios de Amorim Baptista, Member of the Board of Directors
of Corticeira Amorim, holds the position of Director, did
not trade any shares of Corticeira Amorim. This means that
at the end of year she held 20,064,387 shares, representing
15.086% of the share capital, which correspond to 15.086%
of the voting rights.
The share ownership referred to in paragraphs i. and ii.
refers to 31 December 2015, remaining unchanged at the
date of publication of this report.
c) List of Shareholders holding at least one-tenth of the Company’s
share capital:
i. Amorim Capital, SGPS, S.A. held 67,830,000 shares of
Corticeira Amorim, corresponding to 51% of the share
capital and 51% of the voting rights;
ii. Investmark Holdings, B.V. held 24,975,157 shares in Corticeira Amorim, representing 18.778% of this Company’s
share capital and 18,778% of voting rights;
iii.Amorim International Participations, B.V. held 20,064,378
shares in Corticeira Amorim, representing 15.086% of
this Company’s share capital and 15.086% of voting rights.
The share ownership referred to in paragraphs i., ii. and
iii. refers to 31 December 2015, remaining unchanged at
the date of publication of this report.
d) Transactions involving Directors and Officers:
In accordance with the provisions set out in sections 14.6
and 14.7 of Regulation no. 5/2008 of CMVM and according
to notices received from persons/entities covered by
this regulation, it is hereby reported that no transactions
involving the Company’s shares were carried out in the
second half of 2015 by Corticeira Amorim’s Directors
and Officers.
No company which controls Corticeira Amorim or any of
Corticeira Amorim’s directors or officers or any person
closely related to such directors or officers carried out
transactions involving Corticeira Amorim’s financial
instruments.
9. Special powers of the Board of Directors, especially as regards
resolutions on the capital increase (Article 245-A/1/i)) with an
indication as to the allocation date, time period within which
said powers may be carried out, the upper ceiling for the capital
increase, the amount already issued pursuant to the allocation of
powers and mode of implementing the powers assigned.
It is the responsibility of Corticeira Amorim’s Board of Directors
to maintain effective control over the activities of the Company.
It is the highest strategic decision making body and also the body
responsible for monitoring the most important and relevant aspects
of the Company’s business and affairs, including significant matters
decided on or simply examined by the Executive Committee, therefore
ensuring that all members of the Board of Directors are aware of the
measures adopted as a response to Board decisions and can monitor
their implementation and effectiveness.
As provided for in the Portuguese Companies’ Code, the role of the
Board of Directors is to manage the Company’s business and affairs
and decide on any matter relating to its management while abiding
by the resolutions adopted by the General Meeting or the decisions
made by the Supervisory Board whenever required by law or the
Articles of Association.
Viniportu g al Library, Li sbon
63
These duties include, among others:
a) Choosing its Chairman;
b) Co-opting Directors;
c) Requesting the convening of General Meetings;
d) Preparing annual reports and financial statements;
e) Acquisition, disposal and encumbrance of real estate; provision
of guarantees and furnishing collateral and security on behalf
of the company;
f) Opening or closing establishments or important component
parts thereof;
g) Significantly expanding or reducing the Company’s activity;
h) Making major changes in the Company’s organisation;
i) Establishing or terminating important and long-lasting
cooperation projects with other companies;
j) Change of head office;
k) Merging, de-merging or changing the legal status of the
Company;
l) Deciding on any matters put forward at the request of any
director for resolution of the Board of Directors.
The Company’s Articles of Association[2] give the Board of Directors the
following powers: the exercise of all powers of direction, management,
administration and representation of the company; transfer the head
office of the company to any other location permitted by law; create
in any part of the national territory or abroad, delegations, agencies,
subsidiaries, branches, offices or other forms of representation of the
company; acquire, dispose of or encumber in any way the company’s
own shares and debt instruments and any rights, as well as perform
the operations on those securities deemed appropriate; acquire,
sell, exchange and lease real estate by any acts or contracts as well as
encumber them, even if through the pledging of assets; exercise and
promote the exercise of rights of the company in the companies in
which it holds interests; acquire, sell, exchange, lease or encumber
in any manner movable property; negotiate with credit institutions
financing operations; carry out transactions in bank accounts, deposit
and withdraw money, issue, accept, sign and endorse cheques, bills of
exchange, promissory notes, invoice statements and other negotiable
instruments; admit fault, give up or settle any legal action, as well as
enter into arbitration and approve the resulting rulings; perform any
other duties envisaged herein and in law.
The Board of Directors may delegate any of their powers as follows:
×× In one or more Directors or an Executive Committee the
day-to-day management of the Company, establishing the
limits of delegation and/or engaging any or some directors
to handle certain administration matters – in this context, the
matters described in sub-paragraphs a) to k) are not delegable;
×× The implementation of the decisions made by the Board of
Directors, the management of the Company’s ordinary course
of business, the authority and power to implement certain
management duties as well as the determination of the modus
operandi of the Executive Committee may be delegated to
any director or to an Executive Committee – However, the
duties described in sub-paragraphs a), b), c), d), f), j) and k)
are non-delegable.
Viniportu g al tast ing room , Lisbon
As far as increases in the share capital are concerned and in accordance
with article 8 of the Company’s Articles of Association the Board may,
by unanimous decision of its members, increase the share capital, one
or more times, in accordance with the law, up to EUR 250 million. It is
the Board of Directors’ responsibility to fix the terms and conditions
for share capital increases as well as the share subscription period and
payment procedures.
In the financial year under review, the Board of Directors has not
decided to undertake any increase of the share capital of the Company.
10. Information on any significant business relationships between
the holders of qualifying interests and the company.
The Company did not conduct any business operation or deal with
holders of qualifying interests or the entities with which they are
in any relationship in accordance with Article 20 of the Portuguese
Securities’ Code outside normal market conditions. Any business that
occurred fell under the current activity of the contracting parties.
The procedures applicable to these transactions are described in
paragraphs 89 to 91 below.
2
The company’s Articles Association provide that, by unanimous decision of its members, the Board
of Directors may pass resolutions about capital increases, once or more times, in accordance with
the law, up to EUR 250 million, it is also responsible for deciding on the respective terms, conditions
method and length of the subscription and payment period. However, according to the general law
such discretion is not currently in force:
�The last assignment of powers to the Board of Directors was given by the General Meeting
of 2 October 2000, with the resolution to amend article 8, paragraph 1, of the Memorandum
of Association and consequent public deed of 16 October 2000; Article 8, paragraph 1 of
the Memorandum of Association does not indicate the term for the exercise of the powers;
�Article 456, paragraph 1(b) of the Portuguese Companies’ Code states that the Memorandum
of Association should establish the period, not exceeding five years, during which the
powers may be exercised. It also states that in the absence of any indication, the period
shall be five years; paragraph 4 of the same article 456 states that the General Meeting,
deciding with the majority required for amendment of the Memorandum of Association,
may renew the powers of the Board of Directors;
�These powers have not been renewed since October 2005.
Additional information: in October 2000 no capital increases were issued under the powers of the
Board of Directors.
64
B.
corporate Boards
and Commitees
I.GENERAL MEETING
a) Composition of the Presiding Board of the General Meeting
11. Details and position of the members of the Presiding Board of the
General Meeting and respective term of office (beginning and end).
The Presiding Board of the General Meeting consists of a chairman
and a secretary. These posts were held in the current term of office
(2014 to 2016) by:
Chairman: Augusto Fernando Correia de Aguiar-Branco
Secretary: Rita Jorge Rocha e Silva
Beginning of first term of office:
24 May 2014
End of current term of office:
31 December 2016, remaining in office until a new election pursuant
to law.
No changes in the composition of the Presiding Board of the General
Meeting took place during 2015.
enable checking the validity of electronic votes and ensuring their
data integrity and confidentiality. Votes sent by electronic means
must be received by the Company by the third business day prior
to the General Meeting. The Chairman of the General Meeting must
check prior to the convening of the General Meeting, the existence of
technical means and communication to ensure the safety and reliability
of the votes cast. If the Chairman of the presiding Board decides that
the technical requirements for voting by electronic means are met,
such information shall be included in the Notice calling the meeting.
Votes sent by electronic means are equivalent to negative votes for
proposals submitted after the date on which such votes were cast.
The presence of the shareholder at the General Meeting revokes the
vote it may have sent by mail or by electronic means.
Postal ballot forms are available from Corticeira Amorim’s registered
office (Rua de Meladas, no. 380 – 4536-902 Mozelos - Portugal) and from
the Company’s website (www.corticeiraamorim.com). At the request
of a shareholder, such postal ballot forms may be provided by e-mail.
13. Details of the maximum percentage of voting rights that may
be exercised by a single shareholder or by shareholders that are
in any relationship as set out in Article 20/1.
The Articles of Association do not provide for any limit on the number
of votes that each shareholder (either separately or jointly with other
shareholders) is entitled to cast or exercise.
14. Details of shareholders’ resolutions that, imposed by the
Articles of Association, may only be taken with a qualified majority,
in addition to those legally provided, and details of said majority.
The Company’s Articles of Association establish specific requirements
for convening/decision-making quorums, for the following situations:
×× Restriction or withdrawal of pre-emption rights in share capital
increases – the Company’s Articles of Association require that
the Annual General Meeting be attended by shareholders
accounting for at least 50 per cent of the paid-up share capital;
b) Exercising the right to vote
12. Any restrictions on the right to vote, such as restrictions on
voting rights subject to holding a number or percentage of shares,
deadlines for exercising voting rights, or systems whereby the
financial rights attaching to securities are separated from the
holding of securities (Article 245-A/1/f )).
There are no statutory guidelines providing for the existence of
shares that do not carry voting rights or determining that voting
rights exceeding a certain threshold shall not be counted if such votes
are cast by only one shareholder or by a shareholder who is related
to that shareholder. The Articles of Association do not envisage
mechanisms that aim to cause a time lag between the entitlement
to receive dividends or subscribe for new securities and the voting
rights of each ordinary share.
×× Removal from office of a director elected under the special
rules set out in article 392 of the Portuguese Companies’
Code, in the event that shareholders accounting for at least
20 per cent of the share capital have not voted against the
removal of such director;
×× Exercising the right to vote – the need to own at least one
share of the Company’s stock at least five business days prior
to the date scheduled for holding the General Meeting;
×× In order that a General Meeting requisitioned by shareholders
may pass resolutions – it is required that the General Meeting
be attended by shareholders owning shares representing at
least the minimum amount of share capital required by law to
legitimise the reason for calling such meeting;
Each share is entitled to one vote.
The blocking of shares to attend the General Meeting must be made at
least five business days before the date designated for the respective
meeting. The same rule applies when a General Meeting is scheduled
for a later date, when the initial session of the General Meeting is
suspended.
The Articles of Association provide for the possibility of shareholders
voting by mail, provided that the ballots reach the Company at least
three business days before the General Meeting. Postal ballot forms
must reach the registered office of the Company not less than three
business days before the Annual General Meeting. Votes sent by mail
are equivalent to negative votes for proposals submitted after the date
on which such votes were cast. The presence of the shareholder at the
General Meeting revokes the vote it may have sent by mail.
Corticeira Amorim’s Articles of Association allow electronic voting,
provided that there are adequate technical resources available to
×× Change in Board composition– such resolution requires the
approval of shareholders who represent not less than 2/3 of
the total share capital;
×× Winding-up the Company – such resolution requires the
approval of shareholders representing at least 85 per cent of
the paid-up share capital.
II. MA NAGEMENT AND SUPERVISION
a) Composition
15. Details of corporate governance model adopted.
Corticeira Amorim has adopted a system of corporate governance
commonly known as the “strengthened Latin” model, which is based
on a clear separation between administrative and supervisory bodies
as well as double supervision through a supervisory board and a
statutory auditor.
65
The Board of Directors considers that the adoption of this model has
resulted in the constitution of a supervisory body with stronger and
effective supervisory powers composed entirely of members subject
to an incompatibility regime and broader independence regulations.
It also considers that attributing these powers to an autonomous
body – the Supervisory Board – helps create an efficient corporate
governance model because it establishes a clear division between
the management and supervisory bodies, avoiding the granting of
supervisory powers to individual members of the Board of Directors,
which by law is a collegial body.
As a consequence, the Board of Directors is confident that the corporate
governance model adopted is suitable for the specific circumstances
of Corticeira Amorim for the following reasons:
×× It embodies a framework of principles of corporate governance
and good practices designed to promote greater transparency
and a high level of professionalism and competence;
×× It ensures the alignment of interests across the organisation,
specifically among shareholders, members of the governing
bodies, directors and officers and other employees of the
Company;
×× It encourages shareholder participation in the life of the
Company;
×× It fosters the efficiency and competitiveness of Corticeira
Amorim.
Corticeira Amorim encourages an internal reflection on corporate
governance structures and practices adopted by the Company by
comparing their efficiency with the potential benefits to be gained
from implementing other practices and/or measures prescribed in the
CMVM Corporate Governance Act or by other organisations.
This matter – as well as Corticeira Amorim’s organisational development
issues – has been reviewed by the Executive Committee. Reflection
on the corporate governance structure itself has been conducted by
the Executive Committee – in the presence of the market relations
officer – and by the Board of Directors.
16. Articles of association rules on the procedural and material
requirements governing the appointment and replacement of
members of the Board of Directors, the Executive Board and the
General and Supervisory Board, where applicable. (Article 245-A/1/h).
The rules governing the appointment and replacement of members
to the board of directors are those provided for in law, in addition
to a number of specific features set out in the Company’s Articles of
Association:
The election of members to the board shall be done on the basis of
lists specifying the office to be filled by each Director. The voting shall
be carried out in the following manner:
First: one Director shall be elected separately from among
the people proposed on the lists subscribed by the groups
of shareholders who own between 10% and 20% of the share
capital. Each list must propose at least two eligible persons
for each office to be filled, but the same shareholder may not
subscribe to more than one list. If, on a first poll, there are
lists submitted by more than one group of shareholders, then
a poll shall be first taken among all such lists and, thereafter,
among the names of the candidates listed in the winning
list. The lists of candidates may be submitted to the General
Meeting before the business on the agenda relating to the
election of Directors starts to be discussed;
Second: the General Meeting shall elect the remaining directors. All shareholders present may take part in the respective
resolution, regardless of whether or not they signed or voted
66
on any of the lists of the first phase. The General Meeting
cannot elect the remaining Directors until it has elected one
of the nominees on the lists of the first phase, unless no list
has been proposed.
The term of office of the Board members is three calendar
years. At the end of the Directors’ term, the shareholders must
elect new directors or re-elect - one or more times - current
Directors.
At the time of voting the management report, the annual
financial statements and the proposal for appropriation of
profit, the Annual General Meeting may decide to remove
any or all directors from the Board. This will not imply the
payment of any compensation to any Director so removed
from office regardless of whether a Director’s discharge from
employment has been for cause or without cause. However,
this provision will not apply to a Board member elected under
special election procedures on a first poll if members holding
at least a 20% stake in the share capital of the Company resolve
against removing any such Director from office regardless of
the cause for a Director’s discharge from employment.
When a Director is declared to be definitively absent, and there
are no substitutes, he/she shall be replaced by co-option,
unless the directors in office are not sufficient in number for
the board to function. If there is no co-option within 60 days
of the absence, the supervisory board appoints a replacement.
The co-option and appointment by the supervisory board
shall be subject to ratification at the next general meeting.
If a director elected under the special rules of the first stage
is absent permanently, and there is no respective substitute,
a new election shall be held, at which the special rules of the
first phase apply, with necessary adaptation.
17. Composition of the Board of Directors, with details of the Articles
of Association’s minimum and maximum number of members,
duration of term of office, number of effective members, date
when first appointed and end of the term of office of each member.
According to the Articles of Association, the company is administered
by a Board of Directors composed of a Chairman, a Vice-Chairman
and one to nine other members. In the current term, the Board of
Directors consists of a Chairman, a Vice-Chairman and four members,
all incumbent members.
The duration of the term of office of the Board of Directors is three
calendar years.
The Board of Directors was composed of six members over 2015:
Chairman: António Rios de Amorim
Date of first appointment to the Board of Directors:
29 March 1990
First appointment as Chairman of the Board of Directors:
31 March 2001
End of term of current office:
31 December 2016, remaining in office until a new election
pursuant to law.
Vice-Chairman: Nuno Filipe Vilela Barroca de Oliveira
28 March 2003
pursuant to law.
Member: Fernando José de Araújo dos Santos Almeida
31 July 2009
pursuant to law.
Member: Cristina Rios de Amorim Baptista
20 July 2012
pursuant to law.
Member: Luísa Alexandra Ramos Amorim
28 March 2003
Elected as member of the Board of Directors at the General
Meeting of Shareholders of 4 April 2013
pursuant to law.
Member: Juan Ginesta Viñas
20 July 2012
pursuant to law.
18. Distinction to be drawn between executive and non-executive
directors and, as regards non-executive members, details of
members that may be considered independent.
The Board of Directors of CORTIEIRA AMORIM is composed of three
executive members and three non-executive members. Its composition
remained unchanged during 2015:
Executive Members:
Chairman:
Vice-Chairman:
Member:
Non-Executive Members:
Member:
Member:
Member:
Juan Ginesta Viñas
None of the non-executive members are independent.
19. Professional qualifications and other relevant curricular
information of each member of the Board of Directors.
António Rios de Amorim (Chairman):
Chairman of the Board and CEO of Corticeira Amorim since March
2001. He was CEO of Amorim & Irmãos (1996-2001), Director of
Sociedade Figueira-Praia (1993-2006), operational manager at Amorim
- Empreendimentos Imobiliários, promoter of the Lisbon Towers
and Arrábida Shopping projects (1993-1995), and Executive Director
of Amorim Hotéis, SA, in charge of the development of the Ibis and
Novotel chains in Portugal. Degree of Commerce – Faculty of Commerce
and Social Sciences – University of Birmingham (1989) and attended
The Executive Program in Business Administration: Managing the
Enterprise – Columbia University Graduate School of Business (1992),
Managerial Skills for International Business – INSEAD (2001) and
Executive Program in Strategy and Organization – Graduate School of
Business Stanford University (2007). He was a member of the European
Round Table of Industrialists - the only Portuguese corporate group to
belong to this association (1991-1995). Chairman of the Portuguese Cork
Association (2002-2012) and the Confédération Européenne du Liège
(since 2003). In February 2006, he was awarded the Commendation of
Grand Officer of the Order of Agricultural, Commercial and Industrial
Merit by the Portuguese President.
Age: 48
Nuno Filipe Vilela Barroca de Oliveira (Vice-Chairman):
Graduate in business administration from Portuguese Catholic University.
He served as a Non-Executive Director of Corticeira Amorim, from
March 2003 to September 2005, he then proceeded to carry out
executive functions from that date. Non-executive director of various
companies in the Amorim Group (since 2000) and executive director
of Barrancarnes (2000-2005). After a year in the commercial area
of Møre Codfish (Norway), he took part in the Comett programme
and held an internship in Merril Lynch (London), then began his
professional activity in the Banco Comercial Português Group, where,
for three years, he collaborated in the areas of Studies and Planning,
International Area and Investment Funds.
Age: 45
Fernando José de Araújo dos Santos Almeida (Member)
Graduated with a Bachelor’s Degree in Economics from the University
of Porto, Faculty of Economics (1983/84). He joined Corticeira Amorim
in 1991 and held various positions in several of the Group’s member
companies. In 2002, he took over as Manager of Organisational
Development and Business Management Planning and Control at
Corticeira Amorim.
Age: 54
Cristina Rios de Amorim Baptista (Member):
She graduated in Economics from the Faculty of Economics of Porto, in
1991. She completed an MBA in International Banking and Finance from
the University of Birmingham (UK) in 1992 and a postgraduate degree
in International Management from the Portuguese Catholic University
in 2001. She began working in 1992, for international institutions such
as S.G. Warburg España in Madrid (Corporate Finance), N.M. Rothschild
& Sons Limited (Corporate Finance) in London, Rothschild Asset
Management Limited (Asset Management) in London, and Soserfin,
S.A. (management of economic studies and research). She was a
Member of the Board of Directors of Fundação Casa da Música (2006
to March 2013) and of Fundação AEP (2009 to April 2013).
She joined the upper management of the Amorim Group in 1994 and
is currently Director and CFO of Amorim. In 1997 she took office as
Investor Relations Officer at Corticeira Amorim. In July 2012 she took
the role of Director of Corticeira Amorim, SGPS, S.A.
Age: 47
Luísa Alexandra Ramos Amorim (Member):
Bachelor’s degree in Hotel Management and graduate (CESE) in Marketing, from ISAG. Director of Amorim – Investimentos e Participações
(since 2002). Executive Manager of Natureza, S.G.P.S (since 2002)
and Marketing Manager of J. W. Burmester (2000-2002). Began
working in the Amorim Group as Assistant to Hotel Management in
Amorim Hotéis e Serviços and Sociedade Figueira Praia (1996-1997).
She worked in various business areas of the Group in Portugal and
abroad, between 1998 and 2000.
Age: 42
Juan Ginesta Viñas (Member):
With a wide and extensive professional experience in managing
businesses, he has played relevant roles in several international
companies such as International Harvester (sales manager), DEMAG
EO (sales manager), Hunter Douglas (General Manager and the person
responsible for the industrial firms located in Brazil, Argentina and
Chile) and Torras Domenech (Managing Director and CEO). He has
been a director of Trefinos, SL since 1996.
Age: 75
20. Customary and meaningful family, professional or business
relationships of members of the Board of Directors, with shareholders
that are assigned qualifying holdings that are greater than 2% of
the voting rights.
Companies holding or to which qualifying holdings exceeding 2% of
the voting rights of Corticeira Amorim are attributable, which have
directors of Corticeira Amorim on their Board of Directors:
67
×× António Rios de Amorim is a member of the Board of Directors
of Amorim Capital, SGPS, S.A.
×× António Rios de Amorim, Nuno Filipe Vilela Barroca de Oliveira,
Cristina Rios de Amorim Baptista and Luísa Alexandra Ramos
Amorim are members of the Board of Directors of Amorim
Investimentos e Participações, SGPS, S.A.
×× António Rios de Amorim, Nuno Filipe Vilela Barroca de Oliveira,
Cristina Rios de Amorim Baptista and Luísa Alexandra Ramos
Amorim are members of the Board of Directors of Interfamília
II, SGPS, S.A.
×× Cristina Rios de Amorim Baptista is a member of the management body of Amorim International Participations, B.V.
×× António Rios de Amorim and Cristina Rios de Amorim Baptista
are members of the Board of Directors of Amorim – Sociedade
Gestora de Participações Sociais, S.A.
Américo Ferreira de Amorim is Luísa Alexandra Ramos Amorim’s father,
and Nuno Filipe Vilela Barroca de Oliveira’s father-in-law.
×× Adjourn the general meeting, immediately setting
its restart date at no more than 90 days; the same
session cannot be suspended twice;
×× End the session, ensure the minutes are drafted and
sign them.
The Secretary of the Presiding Board of the General Meeting
is responsible for:
×× Assisting the Chairman of the Presiding Board in
conducting the work, including checking attendance
and quorum, organising the attendance list;
×× Reading the agenda stated on the notice and the
documents referred to the presiding board during
the session;
×× Taking notes for drawing up the minutes;
×× Counting the votes;
×× Draw up the minutes and sign them.
António Ferreira de Amorim is the father of António Rios de Amorim
and Cristina Rios de Amorim Baptista.
There are no commercial relations between the members of the Board
of Directors and shareholders to whom a qualifying interest is imputed.
21. Organisational charts or flowcharts concerning the allocation
of powers between the various corporate boards, committees
and/or departments within the company, including information
on delegating powers, particularly as regards the delegation of
the company’s daily management.
As provided for in Corticeira Amorim’s articles of association, the
committee members currently in office are:
Presiding Board of the General Meeting
Composition and term of office as described in section 11 herein.
The Chairman of the Presiding Board of the General Meeting
is responsible for:
×× Calling the General Meetings - preparing the notice
and fostering its publication;
×× Receiving requests for the inclusion of items on the
agenda and, in the event they are approved, publish
the matters included on the agenda in the same
manner used for the notice;
Advisors to the Board of Directors
The meetings of the Board of Directors can rely on, besides
the presence of its members, the presence of its advisors, Mr.
Américo Ferreira de Amorim, who has held the post since 2001,
and Mr. Joaquim Ferreira de Amorim, appointed in July 2012.
The Advisors to the Board of Directors are people who advise
the Board of Directors about the various issues addressed
at board meetings, but they don’t have the right to vote on
resolutions passed at meetings.
In the specific case of Corticeira Amorim, the unrivalled
experience, vision of the future and entrepreneurial spirit of
Mr. Américo Ferreira de Amorim and the extensive knowledge
of the cork industry of Mr. Joaquim Ferreira de Amorim are an
important contribution to the development of the Company,
assuming an important role in the meetings of the Board:
informed and knowledgeable advisors while simultaneously
challenging and driving new initiatives and approaches.
Executive Committee
Composition and term of office as described in section 28 of
this report; duties as described in section 29 of this report.
×× In the case of virtual general meetings (cyber- meetings, online meetings and meetings by conference
call), ensure the authenticity and security of communications;
Supervisory Board
Composition and term of office as described in section 31 of this
report; duties as described in sections 37 and 38 of this report.
×× Choose the location for the general meeting within the
national territory, provided that the head office does
not allow the meeting to be held on satisfactory terms;
Statutory Auditor
Composition, term of office and duties as described in section
39 herein.
×× Chair the general meeting, direct and guide the work,
in particular, check those attending and the quorum,
organise the attendance list, call the meeting to order,
allow, limit or deny the floor to speak, present postal
votes, calculate total votes and announce the results;
Remuneration Committee
Composition, term of office and duties as described in section
67 herein.
×× Authorise the presence in the general meeting of
3rd parties from outside the company; the general
meeting may revoke this authorisation;
68
Board of Directors
Composition and term of office as described in section 17 of
this report; duties as described in section 9 of this report.
Organisational Structure of the Company
As detailed in section 9, the role of the Board of Directors is
to manage the Company’s business and affairs and decide on
any matter relating to its management while abiding by the
resolutions adopted by the Annual General Meeting or the
Cork Beehive , by Anna Loskiewic z
decisions made by the Supervisory Board whenever required
by law or the articles of association. As provided for in law and
the articles of association, the Board of Directors has delegated
the day to day management to an Executive Committee, as
described in sections 28 and 29 of this report.
the Executive Committee in a timely fashion. The Executive
Committee provides in good time and an appropriate manner
to the request, all information requested by other Board
Members and which are necessary in accordance with their
respective duties.
The non-executive members of the Board of Directors regularly
attend the monthly meetings of the Board of Directors, which
analyse and decide on the evolution of all non-delegable
matters and all issues whose relevance, materiality and / or
criticality becomes pertinent to their inclusion in the agenda
of the Board.
Thus, in addition to matters which by law or the articles of
association fall to be considered exclusively by the Board of
Directors, non-executive directors are aware of and monitor:
The organisation of meetings allows all Directors – both
executive and non-executive directors – to adequately prepare
themselves in advance in order to participate fully in the
meeting and to assess and devise measures to improve meeting
productivity and organisation efficiency. The calendar of
regular Board meetings is agreed upon at the beginning of
every financial year so that all members may be able to be
present. Any Director, including non-executive directors,
may request the inclusion of items/topics in the agenda to
be considered by the directors, up to the second business
day prior to any board meeting.
A reporting system between the Executive Committee and
the Board of Directors has been implemented across the
organisation with a view to ensuring alignment of their activities and that the Directors are informed of the activities of
×× The progress of the operating activities and the main
economic and financial key performance indicators
of each BU which forms part of Corticeira Amorim;
×× Relevant consolidated financial information: financing,
investment, equity to total assets ratio and off-balance
sheet liabilities;
×× The business carried on by the various support divisions
and their impact on the organisation;
×× The progress in Research, Development and Innovation
(RDI) activities;
×× The calendar of the major events of Corticeira Amorim
and its BUs. The Organisation is often represented by
one or more non-executive directors at international
events, such as trade missions.
69
Board of
Directors
Advisors to the
Board of Directors
Joaquim Ferreira de Amorim
EXECUTIVE DIRECTORS
CHAIRMAN
VICE-CHAIRMAN
MEMBER
NON-EXECUTIVE DIRECTORS
MEMBER
MEMBER
Juan Ginesta Viñas
MEMBER
Corticeira Amorim’s operating structure is divided into five Business Units (BUs).
Using a management model based on a strategic-operational holding company concept, these BUs are
co-ordinated by Corticeira Amorim’s Executive Committee, which has very broad management powers,
except for those specifically reserved to the Board of Directors by law or the Company’s articles of association.
The strategic alignment of the entire organisation is enhanced through the use of a balanced scorecard approach
by Corticeira Amorim and its BUs. In this regard, Corticeira Amorim’s Board of Directors is responsible for
approving strategic initiatives and goals (i) for the organisation as a whole and (ii) specifically for Corticeira
Amorim and each BU.
Each BU has a Board of Directors composed of non-executive and executive members, including the General
Manager of the BU. This body is the authority responsible for deciding on all matters deemed relevant. The
diagram below shows how the management structure of the business is currently organised:
Board of Directors
Executive Committee
Raw Materials
Cork Stoppers
Floor and Wall
Coverings
Composite
Cork
Insulation Cork
Business Units
70
The Support Divisions are responsible for monitoring and coordinating the operation of the BUs and their
functional areas, under the coordination of the members of the Executive Committee, as shown in the diagram
below: (situation as at 31 December 2015).
Presiding Board of the
General Meeting
GENERAL MEETING
Augusto Fernando Correia
de Aguiar-Branco
CHAIRMAN
Rita Jorge Rocha e Silva
SECRETARY
Remuneration Committee
Supervisory Board
Statutory Auditor
José Manuel Ferreira Rios
Manuel Carvalho Fernandes
CHAIRMAN
CHAIRMAN
Álvaro José da Silva
MEMBER
Ana Paula Africano
de Sousa e Silva
Rui Fernando Viana Pinto
MEMBER
MEMBER
Eugénio Luís Lopes
Franco Ferreira
Pricewaterhousecoopers &
Assoc. SROC, Lda.,
representado por
José Pereira Alves (ROC) ou
por António Joaquim
Brochado Correia (ROC)
Advisors to the
Board of Directors
IN OFFICE
Durval Ferreira Marques
Hermínio António Paulos
Afonso (ROC)
ALTERNATE
ALTERNATE
MEMBER
Board of Directors
Joaquim Ferreira de Amorim
Company's Secretary
CHAIRMAN
Pedro Jorge Ferreira
Magalhães
IN OFFICE
VICE-CHAIRMAN
Pedro Nuno Esteves Duarte
ALTERNATE
MEMBER
MEMBER
MEMBER
Juan Ginesta Viñas
MEMBER
Executive Commitee
CHAIRMAN
Nuno Filipe Vilela
Barroca de Oliveira
MEMBER
Fernando José de Araújo
dos Santos Almeida
MEMBER
Financial
Legal and Tax
Investor Relations
Institutional Communication
Strategic Planning
Fernando José Araújo
dos Santos Almeida
Management Control
Fernando José Araújo dos
Santos Almeida
Organisational
Development
dos Santos Almeida
Sustainability
Nuno Filipe Vilela
Barroca Oliveira
Internal Audit
Nuno Filipe Vilela
Barroca Oliveira
Human Resources
Information Systems and
Technologies
dos Santos Almeida
Procurement, Energy
and Transport
dos Santos Almeida
71
At intervals deemed appropriate, the managing director of
the relevant support division or the Executive Committee or
even the Board of Directors may request a review (and they
effectively do so) of the activity carried out by the different
support divisions in order that the need or opportunity to
create new positions or implement new strategies may be
considered by the Board of Directors.
b) Functioning
22. Availability and place where rules on the functioning of the
Board of Directors, may be viewed.
The modus operandi of the Board of Directors of Corticeira Amorim
scrupulously complies with all applicable rules of procedure regarding
the Board of Directors, specifically those set out in the Portuguese
Companies’ Code, in the Company’s articles of association and in the
regulations issued by the CMVM. This already constitutes real rules
of procedure, that are adequate to and foster its efficient operation
to safeguard the performance of this collegiate body in the efficient
pursuit of the interests of the Company and all its shareholders.
Hence, although no formal Internal Rules as referred in this section
do actually exist, Corticeira Amorim believes that the principles of
good business practice are part of the core values upheld by both
the members of this governing body and the other staff who assist
and/or advise them.
Given that these internal rules have not yet been formalised, they
are not available on the Company’s website. However, the Board
of Directors complies with all rules of procedure prescribed by law
[Portuguese Companies’ Code, Portuguese Securities’ Code, regulations
and instructions issued by the CMVM] or by the Company’s articles of
association, which are available at the CMVM’s website (www.cmvm.pt)
or at the Company’s website (www.corticeiraamorim.com), respectively.
23. The number of meetings held and the attendance report for
each member of the Board of Directors, the General and Supervisory
Board and the Executive Board, where applicable.
Pursuant to the Articles of Association, the Board of Directors shall
meet when and where corporate interest requires. Ten meetings of
the Board of Directors were held during 2015, and all the members of
the Board in office attended or were represented at the 10 meetings.
Overall attendance was 100%. If the representation of directors is
eliminated from this calculation, the attendance rate will be 95.3%.
The following were represented by another director: Nuno Filipe Vilela
Barroca de Oliveira and Juan Ginesta Viñas at the meeting of 4 May;
and Luísa Alexandra Ramos Amorim at the meeting of 12 January. The
other members of the Board of Directors attended all the meetings
in person.
24. Details of competent corporate boards undertaking the
performance appraisal of executive directors.
Pursuant to the articles of association, the General Meeting or a
Committee it elects shall decide on the assessment of the performance
of the executive directors.
As stated in section 67 of this report, there is a Remuneration Committee
(term of office of three years, 2014 to 2016), which is responsible for
carrying out the assessment referred to in this point, and it effectively
did so.
Al m a Gé mea collect ion, A morim in partnersh ip with Matecer â mica
72
25. Predefined criteria for assessing executive directors’ performance.
Pursuant to the statement on the policy for remunerations awarded
to the Board of Directors approved at the General Shareholders’
Meeting of 24 March 2015 (Section 69), as proposed by the company’s
Remuneration Committee, a variable remuneration shall be added, if
deemed adequate and feasible, to the fixed remuneration for executive
directors. This variable remuneration shall be calculated weighing up
financial and non-financial indicators, and according to the contribution
of the executive directors, that is impartial and measurable through
the balanced scorecard method (which establishes, defines and implements three-year
goals and targets: results, innovation, financial soundness, value creation, competitiveness
and growth) on an individual and/or collective basis, to the sustainable development of the
business activity, to the medium/long term profitability of the Company and to the creation
of value for the Shareholder.
26. The availability of each member of the Board of Directors, the General and Supervisory
Board and the Executive Board, where applicable, and details of the positions held at the
same time in other companies within and outside the group, and other relevant activities
undertaken by members of these boards throughout the financial year.
António Rios de Amorim (Chairman):
Company
Position Held
Corticeira Amorim Group
Amorim Natural Cork, S.A.
Amorim Florestal España, S.L .
Amorim Compcork, Lda.
Amorim Industrial Solutions – Imobiliária, S.A.
Chapius, S.L .
Comatral – Compagnie Marrocaine de Transformation
du Liège, S.A.
Dom Korkowy, Sp. Zo.o
Equipar – Participações Integradas, SGPS, Lda.
Korken Schiesser GmbH
Olimpíadas Barcelona 92, S.L .
Société Nouvelle des Bouchons Trescasses, S.A.
SIBL – Société Industrielle Bois Liège, S.A.R.L .
Chairman of the Board
Manager
Manager
Manager
Chairman of the Board and Chairman of the
Presiding Board of the General Meeting
Member of the Board of Directors
Manager
Manager
Administrator
Manager
Other Companies
Afaprom – Sociedade Agro-Florestal, S.A.
Agolal, S.A.
Amorim, S.G.P.S., S.A.
Amorim Capital – Sociedade Gestora de Participações
Sociais, S.A.
Amorim – Investimentos e Participações, S.G.P.S., S.A.
Amorim – Participações Agro-Florestal, S.G.P.S., S.A.
Amorim – Participações Imobiliárias, S.G.P.S., S.A.
Bomsobro – Sociedade Agro-Florestal, S.A.
Caneicor – Sociedade Agro-Florestal da Caneira, S.A.
Cimorim – Sociedade Agro-Florestal, S.A.
Corunhal – Sociedade Agro-Florestal, S.A.
Fruticor – Sociedade Agrícola de frutas e Cortiças, S.A.
Interfamília II, S.G.P.S., S.A.
Agropecuária Mirantes e Freires, S.A.
OSI – Sistemas Informáticos e Electrotécnicos, Lda.
QM1609 – Investimentos Imobiliários, S.A.
Quinta Nova de Nossa Senhora do Carmo, S.A.
Resiféria – Construções Urbanas, S.A.
Clube de Tiro, Caça e Pesca a Agolal
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
of
of
of
of
of
of
of
of
of
of
the Board of Directors
Manager
Treasurer
73
Nuno Filipe Vilela Barroca de Oliveira (Vice-Chairman):
Company
Position Held
Vice-Chairman of the Board of Directors
Amorim Cork Ventures, Lda.
Manager
Amorim Industrial Solutions – Imobiliária, S.A.
Other Companies
API – Amorim Participações Internacionais, S.G.P.S., S.A.
Casa das Heras – Empreendimentos Turísticos, S.A.
OSI – Sistemas Informáticos e Electrotécnicos, Lda.
Paisagem de Alqueva, S.A.
Member
Member
Member
Member
of
of
of
of
the Board of
the Board of
the Board of
the Board of
Manager
Member of the Board of
Manager
Directors
Directors
Directors
Directors
Directors
Fernando José de Araújo dos Santos Almeida (Member):
Company
Position Held
Vatrya – Consultoria e Marketing, Lda.
Manager
Manager
Cristina Rios de Amorim Baptista (Member):
Company
Position Held
Other Companies
Afaprom – Sociedade Agro-Florestal, S.A.
Agolal – Sociedade Agro-Florestal, S.A.
Agro-Pecuária Mirante e Freires, S.A.
Amorim – Participações Agro-Florestais, S.G.P.S., S.A.
Amorim – Participações Imobiliárias, S.G.P.S., S.A.
Amorim – Serviços e Gestão, S.A.
Amorim – Sociedade Gestora de Participações Sociais, S.A.
Amorim – Viagens e Turismo, Lda.
Amorim Desenvolvimento, S.G.P.S., S.A.
Imotur – Fundo Especial de Investimento Imobiliário Fechado
Amorim Global Investors, S.G.P.S., S.A.
Bomsobro – Sociedade Agro-Florestal, S.A.
Caneicor – Sociedade Agro-Florestal da Caneira, S.A.
Cimorim – Sociedade Agro-Florestal, S.A.
Corunhal – Sociedade Agro-Florestal, S.A.
74
Chairman of Remuneration Committee
Manager
First Vice-Chairman of the Board of Directors
Manager
Member of Advisory Committee
Company
Fruticor – Sociedade Agrícola de Frutas e Cortiças, S.A.
Amorim International Participations, B.V.
Resiféria – Construções Urbanas, S.A.
MCMAB – Serviços e Gestão, Lda.
Position Held
First Vice-Chairman of the Board of Directors
Director
Manager
Luísa Alexandra Ramos Amorim (Member):
Company
Position Held
Other Companies
Amorim – Investimentos e Participações, SGPS, S.A.
Bucozal – Investimentos Imobiliários e Turísticos, Lda.
Interfamília II, SGPS, S.A.
Vintage Prime, SGPS, S.A.
Manager
Juan Ginesta Viñas (Member):
Company
Position Held
Trefinos, S.L .
Other Companies
Les Finques, S.A.
c) Committees within the Board of Directors or Supervisory
Board and Board Delegates
27. Details of the committees created within the Board of Directors,
the General and Supervisory Board and the Executive Board, where
applicable, and the place where the rules on the functioning
thereof is available.
There is an Executive Committee, created by delegation of powers by
the Board of Directors. Although there are no formal rules of procedure
available for viewing, the functioning of the Executive Committee
complies with all the rules governing its work, namely those of the
Portuguese Companies’ Code, the Articles of Association and the
procedures adopted internally. This constitutes by itself adequate rules
of procedure that enable the implementation of the best practices,
safeguarding the effectiveness of the Company and creating value
for shareholders.
Sole Director
29. Description of the powers of each of the committees
established and a summary of activities undertaken in exercising
said powers.
The Executive Committee exercises the powers delegated to it by the
Board of Directors - in the precise terms provided for in the articles of
association and in law, as described in section 9 herein -, with a view to
streamlining management practices and making possible closer and
continuous monitoring of the Company’s different areas (management,
operations and support) and its operating and business processes.
According to Corticeira Amorim’s articles of association, the Executive
Committee is vested with the power to implement the decisions made
by the Board of Directors, manage the Company’s ordinary course of
business and implement certain management duties. The activity of
the Executive Committee was conducted in 2015 according to these
duties, with the purpose of performing:
As already referred to for the Board of Directors, it should be added
that the principles of good business practice are part of the core
values upheld by both the members of this committee and the staff
members who assist and/or advise them.
×× The day-to-day management of the company;
28. Composition of the Executive Committee.
The Executive Committee shall consist of three members, i.e., a Chairman
and two Members. The composition of this board remained unchanged
in 2015, so the members at the end of the year continued to be:
×× The alignment of the activity of the various business units
that constitute the Company, and analysis of the respective
reporting;
×× The implementation of the decisions taken by the Board of
Directors;
×× Budget estimates and setting goals and objectives;
Chairman: António Rios de Amorim
Member: Nuno Filipe Vilela Barroca de Oliveira
×× In terms of human resources: analysis of the evolution of
indicators, policy and priorities for training, performance
assessment, salary policy;
Member: Fernando José de Araújo dos Santos Almeida
The term of office of the Executive Committee coincides with
that of the Board of Directors.
×× Monitoring the evolution of critical business factors, definition
and implementation of management measures concerning
those factors (evolution of prices of main inputs, interest
rates and exchange rates);
75
Wicander Art Comfort, Recla imed
76
×× Follow up and decisions on investment, loans and taking on
liabilities;
×× Definition of the internal audit and internal control activities
and reporting on the main conclusions;
×× Policy definition and decision on priority action in the field
of Research, Development and Innovation;
×× Monitoring the Corticeira Amorim share price: transactions,
price development, analysts’ estimates;
×× The analysis and reflection on the corporate governance
model and its suitability to the company and respective goals.
With a properly implemented reporting system within the Company,
information flows from the members of the Executive Committee to
the Directors, thus ensuring that the performance of the members of
both the Board and the Committee are aligned and that every director
is informed of the work and activities of the Executive Committee in
a timely manner.
The Chairman of the Executive Committee, who is also the Chairman
of the Board of Directors, provides timely minutes of meetings of the
Executive Committee meetings to the Chairman of the Supervisory Board.
The Executive Committee, met sixteen times during 2015. The attendance
rate was 93.8%. Individually, the attendance rate of António Rios de
Amorim and Fernando José de Araújo dos Santos Almeida was 100%;
while that of Nuno Filipe Vilela Barroca de Oliveira was 81% (three
absences; reason: representation of the company abroad).
III. SUPERVISION
a) Composition
30. Details of the Supervisory Body (Supervisory Board, the Audit
Committee or the General and Supervisory Board) representing
the model adopted.
The Company has adopted the governance model commonly known
as the “reinforced Latin” model, with a double supervisory mechanism
consisting of a supervisory board and a statutory auditor.
31. Composition of the Supervisory Board, with details of the articles
of association’s minimum and maximum number of members,
duration of term of office, number of effective members, date of
first appointment, date of end of the term of office for each member.
The articles of association establish that the Supervisory Board consists of
three members and one or several alternate members. The Supervisory
Board was composed of three members and one alternate member
during the current mandate (2014-2016):
Chairman: Manuel Carvalho Fernandes
Member: Ana Paula Africano de Sousa e Silva
Member: Eugénio Luís Lopes Franco Ferreira
Date of first appointment to the Supervisory Board:
24 March 2014
End of term in office:
pursuant to law
Alternate: Durval Ferreira Marques
Date of first appointment to the Supervisory Board:
28 May 2007
Date of first appointment as Alternate to the Supervisory Board:
24 March 2014
pursuant to law
32. Details of the members of the Supervisory Board, which are
considered to be independent pursuant to Article 414 (5) of the
Portuguese Companies’ Code.
As far as the Company knows, all members of the Supervisory Board,
both incumbent and alternate members, meet the independence
criteria set out in Article 414 (5) as well as the incompatibility rules
envisaged in Article 414-A(1), both of the Portuguese Companies’ Code.
The alternate member of this board, Durval Ferreira Marques, is not
considered to be independent since he does not meet the criterion
set out in subparagraph (b), paragraph 5 of Article 414 (after three
terms as Chairman of the Supervisory Board, he was elected the
alternate for that same body). He meets the remaining requirements
of independence as well as the incompatibility rules referred to in the
preceding paragraph.
33. Professional qualifications of each member of the Supervisory
Board, and other important curricular information.
Manuel Carvalho Fernandes (Chairman):
of Porto, Faculty of Economics. MBA from Universiteit te Leuven
Kaholieke (Leuven, Belgium). Professional career in the financial
sector (1979 - 1995) - Banco Português do Atlântico, State Secretary
of the Treasury (1986-1988), President of Banco Comercial de Macau
(1989-1995), the Insurance Company Bonança (1992-1995) and of the
Portuguese Banks’ Union (1993-1995). Director of Banco Mais (19972011), Seguros Sagres (2006-2008), Finibanco (2004-2006). CEO of
SGAL - Sociedade Gestora Alta de Lisboa (1998-2007).
In the last five years he has held several director level positions in a
number of companies (other than those referred to in number 36):
BANIF, SGPS, S.A., BANIF – Banco Internacional do Funchal, S.A.,
Tecnicrédito, SGPS, S.A., Banco MAIS, S.A., Finpro, SCR, S.A. and
Finpro Unipessoal, Lda.
Ana Paula Africano de Sousa e Silva (Member):
Graduated with a Bachelor’s Degree in Economics from the University of
Porto, Faculty of Economics. PhD degree in Economics (specialisation
in International Economics) from the University of Reading - England,
in 1995; equivalence to a PhD degree from the Faculty of Economics of
the University of Porto in January 1996. Completed the lecture part of
the Master in Economics in 1989, Faculty of Economics of Porto. Senior
technician (part-time) in the Studies Department of the Portuguese
Statistics Agency (Instituto Nacional de Estatística), Porto Regional
Office, from March 1996 to February 1998. Working in the Economics
Faculty of Porto University, where he is a member of the Scientific
Board and also lectures: Theory and Foreign Trade Policy (Master
of Economics), International Commerce (Master of Economics and
International Management), International Strategic Management (MEGI),
International Economics (Bachelors of Economics and Management);
Economic Integration, Applied Economic Studies, Microeconomics
and Macroeconomics (Bachelor’s Degree in Economics).
Combines teaching with extensive scientific work (supervising PhD
theses, master’s degree dissertations, sitting on juries) and academic
publications.
Member of the Inter-university Association of European Studies in
Portugal and the European Union Studies Association (Pittsburgh, USA).
For the past five years he has not held any director level positions.
Eugénio Luís Lopes Franco Ferreira (Member):
of Porto, Faculty of Economics in 1976 where he lectured Financial
Mathematics in 1976/1977. Began working in 1966. In 1977 he joined
Price Waterhouse, currently, PricewaterhouseCoopers (Partner in 1991).
He worked in the Audit Department, participating in numerous audits
of corporations and other entities, mainly in the industrial and service
areas. In most cases, the extension of the responsibilities as auditor
77
Beginning of the cork industr ial process
included becoming a member of supervisory boards or working as a sole
supervisor. He also performed at the same time a variety of in-house
roles, namely: manager of the Porto office; nationwide responsibility
for the technical function of auditing and risk management (“Technical
Partner” and “Risk Management Partner”); nationwide responsibility for
the administrative, financial and IT functions (“Finance & Operations
Partner”); responsibility of the Audit Department; Member of the
Executive Committee (“Territory Leadership Team”). He ceased to
work for PricewaterhouseCoopers in 2009, becoming a self-employed
professional consultant.
He is a member of the Portuguese Statutory Auditors Association
(member of the Board of Governors in 2009 -2011), of the Portuguese
Economists Association, of the Portuguese Accountants Association
and Partner of the Portuguese Institute of Corporate Governance.
Durval Ferreira Marques (Alternate Member):
of Porto, Faculty of Economics, he was a technical education lecturer
and a technical assistant at the Directorate-General of the Central Bank
of Angola. He held management positions in the finance, insurance,
media and industry sectors in South Africa for over 25 years. He was
78
also a representative of the Portuguese Business Association in South
Africa and Mozambique.
b) Functioning
34. Availability and place where the rules on the functioning of the
Supervisory Board may be viewed.
The Rules of the Supervisory Board of the Company can be viewed
at http://www.amorim.com/xms/files/Investidores/2_Orgaos_
Sociais/2014-2016_Regulamento_do_Conselho_Fiscal.pdf
35. The number of meetings held and the attendance report for
each member of the Supervisory Board.
The Supervisory Board meets whenever called by the Chairman or by
any other two members of the Supervisory Board, and at least every
quarter, pursuant to article 10 of the rules of procedure of that body.
Five meetings of the Supervisory Board were held during 2015. The
Chairman of the Supervisory Board missed only one of the meetings
because he was out of the country. Nevertheless, he still participated
by video conference in part of that meeting.
The overall attendance was 93.3%; that of the Chairman was 80% and
of the other members it was 100%.
36. The availability of each member of the Supervisory Board, indicating the positions
held simultaneously in other companies inside and outside the group, and other relevant
activities undertaken by members of these Boards.
Manuel Carvalho Fernandes (Chairman):
Company
Position Held
Grupo AFSA, SGPS, S.A. - management positions:
AFSA, SGPS, S.A.
COEPAR – Consultoria e Investimentos, S.A.
S2IS – Serviços e Investimentos, SGPS, S.A.
BRASILIMO – Investimentos Imobiliários no Brasil, SGPS, S.A.
SSL – Serviços e Investimentos, S.A.
QMETRICS – Serviços, Consultoria e Avaliação da Satisfação, S.A.
Other companies - management positions:
Faceril – Fábrica de Cerâmica do Ribatejo, S.A.
Coeprimob – Promoção Imobiliária, S.A.
Qdata, Lda.
Quaternaire, S.A.
Grupo AFSA, SGPS, S.A. - other positions:
Douro Empreendimentos Imobiliários, Lda.
Brasilimo Empreendimentos Imobiliários, Lda.
Other companies - other positions:
Director
Director
Director
Director
Director
Director
Director
Director
Manager
Director
Advisory Board
Advisory Board
Oriente Foundation
Curator
Ana Paula Africano de Sousa e Silva (Member):
Institution
Position Held
Other companies
University of Porto
Faculty of Economics from the University of Porto
Lecturer
Member of the Board of Representatives
Member of the Scientific Committee of the Master's
Degree in Economics and International Management
CEFUP (Centre of Economic and Financial Studies)
Member
Eugénio Luís Lopes Franco Ferreira (Member):
Company
Position Held
Other companies
NOS, SGPS, S.A.
Member of the Supervisory Board
Since 2009, he acts professionally as a self-employed consultant.
Durval Ferreira Marques (Alternate Member): Does not hold any post in any other company.
c) Powers and duties
37. A description of the procedures and criteria applicable to the supervisory body for the
purposes of hiring additional services from the external auditor.
The Supervisory Board is responsible for monitoring the independence of the Statutory Auditor,
especially in relation to the provision of additional services.
The Supervisory Board is aware of the company’s practices on this topic (described in the
following paragraphs). The Supervisory Board ensured it was fully informed during the year of
79
the nature and extent of the contracted services and the respective
amounts. It did not identify in the current year any situation, taking
into account the mitigating factors of risk, that might affect the
independence of the Statutory Auditor.
Other services are contracted from PricewaterhouseCoopers (and not
the additional services provided by the external auditor), subject to
approval by the Executive Committee. Such services essentially refer
to assistance for the implementation of administrative mechanisms
to address legal formalities.
Under such services:
i.PricewaterhouseCoopers does not lead the underlying
projects. These projects are always headed by the
appropriate department of Corticeira Amorim;
ii. The representatives from PricewaterhouseCoopers
appointed to the position of Statutory Auditor of Corticeira
Amorim do not collaborate on these projects;
There are, therefore, no issues regarding the independence of the
work of the Statutory Auditor.
It is to be noted that the entry into force on 1 January 2016 of Law No.
140/2015 of 7 September, approving the new Statutes of the Order of
Statutory Auditors and Law No. 148/2015 of 9 September approving
the Legal Regime for Audit Supervision, implied that the provision of
services by the Statutory Auditor is substantially limited (a wide range
of services are legally prohibited and the rest are limited to 30% of the
total fees paid to the Statutory Auditor) and that the non-prohibited
services require the prior approval of the Supervisory Board.
38. Other duties of the supervisory body.
The Supervisory Board is responsible, under the law and respective
Rules of Procedure, for the following:
×× Oversee the management of the company;
×× Monitor compliance with the law and articles of association;
×× Check the correctness of the accounting records and documents
supporting those records;
×× Check when deemed convenient and in the manner considered
adequate, the extent of cash and stocks of any kind of goods
or assets owned by the company or received as collateral,
deposit or otherwise;
×× Check the accuracy of the financial statements;
×× Check whether the accounting policies and valuation criteria
adopted by the company lead to a correct assessment of the
assets and profits;
×× Prepare an annual report on its supervisory action and give
an opinion on the report, accounts and proposals submitted
by management;
×× Convene the General Meeting when the Chairman of that
Presiding Board does not and should do so;
×× Monitor the effectiveness of the risk management system,
internal control system and internal audit system;
×× Receive reports of irregularities presented by shareholders,
company employees or others, giving them due treatment;
MDFaç ade Wave
80
×× Analyse the reports of irregularities received, requesting from
the company’s other corporate bodies and structures the
necessary explanations for the reported situations;
×× Suggest, following the analysis referred to in the preceding
paragraph, measures to safeguard from the occurrence of
such irregularities and give knowledge of them to the Board
of Directors and to the internal or external entities that each
situation warrants, while always guaranteeing the non-disclosure
of the identity of those reporting such situation, unless they
expressly do not wish such;
×× Outsource for the provision of expert services to assist one
or more of its members in the exercise of their duties; the
hiring and remuneration of experts must take into account
the importance of the entrusted matters and the financial
situation of the company; the scope and conditions of the
provision of services to be hired must be communicated in
advance to the Board of Directors;
×× Examine and issue its prior opinion on the transactions with
Qualified Shareholders, as set down in specific regulations;
×× Suspend directors when their health temporarily prevents
them from performing their duties, or when other personal
circumstances preclude them from carrying out their duties
for a period of time presumably greater than sixty days and
they ask the Supervisory Board to be temporarily suspended
or the Board deems this to be in the interest of the company;
×× Declare the removal from office of Directors when, following
their appointment, there occurs some form of incapacity or
incompatibility that poses a barrier to that appointment and
the director does not leave that post or does not remove the
supervening incompatibility within thirty days;
×× Check that the published report on the corporate governance
structure and practices includes the provisions referred to in
article 245-A of the Portuguese Securities’ Code.
The entry into force of the laws referred to in section 37, on 1 January
2016 means the Supervisory Board will have added responsibilities
particularly in terms of interaction with the Statutory Auditor. The
Supervisory Board is assigned the following duties:
×× Inform the Board of Directors of the results of the statutory
audit and explain how this contributed to the integrity of the
process of preparation and disclosure of financial information, as
well as the role played by the Supervisory Board in this process;
×× Monitor the process of preparation and disclosure of financial
information and submit recommendations or proposals to
ensure its integrity;
×× Supervise the effectiveness of the internal quality control,
risk management and internal audit systems, as regards the
process of preparation and disclosure of financial information;
×× Monitor the statutory audit of the individual and consolidated
annual accounts, in particular the implementation of the same;
×× Check and monitor the independence of the statutory auditor
and, in particular, verify the adequacy and approve the provision
of other services besides the audit services;
×× Select the Statutory Auditor to propose to the General Meeting
for contracting.
IV. STATUTORY AUDITOR
×× Comply with all other duties set down by law or the articles
of association;
39. Details of the statutory auditor and the partner representing it.
The Statutory Auditor shall consist of one member and one alternate
member, any one of which may be a statutory auditor or statutory
auditor firm.
×× Must assess the management report, the annual accounts, the
legal certification of accounts or impossibility of certification
and issue and send the report and opinion to the Board of
Directors, within fifteen days from the date of receipt of said
components of the report of accounts;
The members of this body in office on 31 December 2013, elected for
the 2011 to 2013 term, remained in office according to law until an
election was held, which was on 24 March 2014, in the General Meeting.
This General Meeting re-elected all members for a new term, namely
from 2014 to 2016:
×× Issue in its report and opinion a statement that, relating to
the annual directors’ report, the annual accounts, and other
accounting documents required by law or CMVM Regulations,
to the best of its knowledge, the information was prepared
in accordance with applicable accounting standards, giving a
true and fair view of the assets and liabilities, financial position
and profit/loss of the company and the companies included in
the consolidation perimeter, and that the management report
faithfully describes the evolution of the business, the company’s
performance and position and of the companies included in
the consolidation perimeter, and it contains a description of
the principal risks and uncertainties that they face;
Member: PricewaterhouseCoopers & Associados – Sociedade
de Revisores Oficiais de Contas, Lda, registered in the CMVM
since 15 July 2004 under number 20161485, represented by
José Pereira Alves (Statutory Auditor) or António Joaquim
Brochado Correia (Statutory Auditor).
×× Supervise the process of preparing and disclosing financial
information;
×× Propose to the General Meeting the appointment of a Statutory
Auditor;
×× Supervise the audit of the company’s accounts and accounting
documents;
×× Supervise the independence of the Statutory Auditors, especially
in relation to the provision of additional services;
Alternate: Hermínio António Paulos Afonso (Statutory Auditor)
End of term of office:
pursuant to law.
The Statutory Auditor is responsible for the following:
×× Undertake all necessary examinations and checks for the audit
and issue of the statutory audit certificate of the company’s
accounts. The following must be checked, in particular:
The correctness of the accounting records and documents
supporting those records;
When deemed convenient and in the manner considered
adequate, the extent of cash and stocks of any kind of
goods or assets owned by the company or received as
collateral, deposit or otherwise;
81
The accuracy of the financial statements;
Whether the accounting policies and valuation criteria
adopted by the company lead to a correct assessment
of the assets and profits;
×× Immediately report by registered letter to the chairman of the
board of directors the facts in its possession that it considers
indicate serious difficulties in the pursuit of the company’s
object, including repeated non-payments to suppliers, bad
debts, issuing cheques without sufficient funds, failure to
pay social security contributions or taxes. Request that the
Chairman of the Board of Directors, in the event no reply was
made to a letter or request or the reply received was deemed
unsatisfactory, the convening of the board of directors to meet,
with the statutory auditor present, to appraise the facts and
take the appropriate decisions. If the meeting is not held or if
the adopted measures are not deemed adequate to safeguard
the interests of the company, it must require, by registered
letter, that a general meeting is convened to appraise and
decide on the facts contained in the mentioned registered
letters and the minutes of the above-referred meeting of the
board of directors.
40. State the number of years that the statutory auditor consecutively
carries out duties with the company and/or group.
Pricewaterhousecoopers & Associados – Sociedade de Revisores Oficiais
de Contas, Lda. has performed the duties for eleven consecutive years,
while the Statutory Auditor representing that company has been in
this role for four years.
There is no policy of rotation of the Statutory Auditor. Continuation
in service of the statutory auditor is subject to a careful assessment of
the advantages and disadvantages thereof, in particular the expertise
and experience acquired in the type of business in which the Company
is engaged in. Corticeira Amorim’s external auditors, PricewaterhouseCoopers & Associados, S.R.O.C., Lda., meet the independence
requirements and this is reinforced by the fact the partner in charge
of the Company’s audit is proposed to be rotated every seven years,
a procedure in line with the best international practices. The audit of
the company over the last four years has been conducted by António
Joaquim Brochado Correia.
The Supervisory Board is effectively responsible for annually assessing
the Statutory Auditor, supervising the audit of the accounts and the
financial statements of the company, overseeing the independence
of the Statutory Auditor, notably as regards the provision of additional
services. It may also propose the dismissal or termination of the
contract celebrated with the Statutory Auditor.
Helix pack aging solut ion in P ortu guese Wine
82
41. Description of other services that the statutory auditor provides to the company.
The Company and companies with which it is in a group relationship contracted the following
services from PricewaterhouseCoopers, including other entities belonging to the same network,
services whose nature and value are detailed in the following table:
Type of service
Audit of accounts
Cor ticeira Amorim
€
54,000
%
94.9%
O ther group companies
€
254,159
%
66.2%
Total
€
308,159
%
69.9%
Assurance
1,000
1.8%
7,176
1.9%
8,176
1.9%
Tax consultancy
1,892
3.3%
9,953
2.6%
11,845
2.7%
0
0.0%
112,371
29.3%
112,371
25.5%
56,892
100.0%
383,659
100.0%
440,551
100.0%
Others (besides auditing)
Total
The term “Other services” essentially refers to assistance for the implementation of administrative
mechanisms to address legal formalities.
The independence of these service providers is not called into question as the leadership of
the projects such service providers take on is always assumed by the appropriate department
of Corticeira Amorim.
V. EXTERN AL AUDITOR
42. Details of the external auditor appointed in accordance with Article 8 and the partner
that represents same in carrying out these duties, and the respective registration number
in the CMVM.
The external audit of Corticeira Amorim is performed by the Statutory Auditor (as identified
in section 39).
43. State the number of years that the external auditor and respective partner that
represents same in carrying out these duties consecutively carries out duties with the
company and/or group.
As set out in section 40 above.
44. Rotation policy and schedule of the external auditor and the respective partner that
represents said auditor in carrying out such duties.
45. Details of the Board responsible for assessing the external auditor and the regular
intervals when said assessment is carried out.
46. Details of services, other than auditing, carried out by the external auditor for the
company and/or companies in a control relationship and an indication of the internal
procedures for approving the hiring of such services and a statement on the reasons for
said hire.
As set out in section 41 above. (identification of work) and in section 37. (internal procedures).
47. Details of the annual remuneration paid by the company and/or legal entities in a
control or group relationship to the auditor and other natural or legal persons pertaining
to the same network and the percentage breakdown relating to the following services.
83
C.
INTERNAL
ORGANISATION
Company; (ii) the non-imposition of the use of a specific format for
such reports and the fact that the whistleblower may use the channels
it deems most suitable to make the report; (iii) the obligation to ensure
protection of personal data (scrupulously following the instructions
given by whistleblowers regarding confidentiality) that safeguard the
rights of both whistleblowers and other staff members involved, while
ensuring that the reporting process remains simple, and contribute
effectively to promoting the impartial investigation and clarification
of the situations reported.
III. Intern al control and risk management
I. Art icle s of Asso c iation
48. The rules governing amendment to the articles of association
(Article 245-A/1/h).
The rules governing the amendment of the Articles of Association of
the Company are those provided for by law, with the addition of the
following specific provisions set out in the aforementioned articles:
the Company is managed by a Board of Directors consisting of a
Chairman, a Vice-Chairman and from one to nine other Members.
This statutory provision may be amended only with the approval by
a majority of shareholders representing at least two-thirds of the
Company’s share capital.
50. Individuals, boards or committees responsible for the internal
audit and/or implementation of the internal control systems.
The Internal Audit Department has powers over such matters.
51. Details, even including organisational structure, of hierarchical
and/or functional dependency in relation to other boards or
committees of the company.
These departments work under the command of the Board of Directors,
closely directed by the Executive Committee.
52. Other functional areas responsible for risk control.
The main aim of the Board of Directors and the Executive Committee is
to establish an integrated overview of critical success factors in terms of
profitability and/or associated risks with a view to creating sustainable
value for both the Company and its shareholders.
II. Rep orting of irregul aritie s
49. Reporting means and policy on the reporting of irregularities
in the company.
It is the responsibility of Corticeira Amorim’s Supervisory Board - in
accordance with its rules of procedure – to receive the information on
wrongful acts reported by shareholders, employees or other individuals
or bodies and to treat such whistle-blowing reports appropriately.
Such reports shall be addressed to:
Supervisory Board of Corticeira Amorim, SGPS, S.A.
Address - Registered office of the company:
Rua de Meladas, n.º 380 – Apartado 20 - 4536-902 MOZELOS
Telephone: 22 747 54 00
The Company ensures that the Supervisory Board will be the first to
be made aware of the contents of such whistle-blowing reports (no
employee of the Company is authorised to open mail specifically
addressed to this corporate body or any of its individual members).
It is the Supervisory Board’s responsibility to review any such reports
and ask the Company’s other governing bodies and officers for any
explanations on the disclosed events and the circumstances surrounding
the situation. In dealing with concrete situations, the Supervisory
Board is entitled to:
×× Suggest measures to prevent such irregularities occurring;
×× Report any identified and confirmed irregularities to the
Board of Directors and relevant authorities, both internal and
external, in accordance with each specific situation.
The Company guarantees that the identity of whistle-blowers will not
be disclosed throughout the process, unless they expressly choose
to disclose their identity.
Corticeira Amorim believes that there are a number of measures, i.e.
(i) the assignment of such responsibilities to the Supervisory Board – a
body composed entirely of independent members, thus ensuring the
impartial handling and consideration of irregularities reported to the
84
Because of Corticeira Amorim’s specific business characteristics, two
critical factors have been identified at the operational level: (i) market
risk and business risk and (ii) raw materials (cork) risk. The management
of such risks is the responsibility of the relevant BU.
53. Details and description of the major economic, financial and
legal risks to which the company is exposed in pursuing its business
activity.
Market risk and operational business risk:
In the first instance, market risk and business risk are managed by the
four BUs – Cork Stoppers, Floor and Wall Coverings, Cork Composites
and Insulation Cork – that are involved in the markets that deal in
Corticeira Amorim’s finished products.
In devising a strategic plan for these BUs – a strategic plan based on
the balanced scorecard methodology – a number of key factors for
value creation are identified by using a multifaceted approach that
encompasses the outlook for finance, market/customers, processes
and infrastructures. Using this approach, strategic objectives and goals
are defined as well as the actions required to achieve them.
The adopted method strengthens alignment between the defined
strategy and operational planning where such are defined, for a shorter
time horizon, the priority actions to develop to reduce risk and ensure
sustained value creation. The BUs have implemented processes that
allow the systematic monitoring of these actions, which are subject to
periodic monitoring and monthly evaluation by the Board of Directors
of the BU.
Raw materials (cork) risk:
The management of the procurement, storage and preparation of
the single variable common to all business activities of Corticeira
Amorim, i.e. the raw material (cork) is centralised in an autonomous
BU, given the critical nature of this factor across all the BUs. This
permits the following:
×× Form a specialised team exclusively focused on raw materials;
×× Make the most of synergies and integrate all raw materials (cork)
manufactured by other BUs in the relevant BU’s production
process;
×× Improve the management of raw materials from a multinational
perspective;
×× Strengthen its presence in cork-producing countries;
×× Keep an updated historical record of production status by
cork-producing forest unit;
×× Strengthen relationships with producers, promote forest
certification, improve the technical quality of products and
enter into research and development partnerships with
forestry-related partners;
×× Prepare, discuss and enable the Board of Directors to decide
on a multi-annual purchasing policy to be implemented;
×× Ensure that an optimal mix of raw materials is used to meet
market demand for finished products;
×× Ensure the supply stability of cork, a critical variable for
Corticeira Amorim’s operations, over the long term.
Legal Risk:
As far as legal risks are concerned, the main risk to the business of
Corticeira Amorim and its subsidiaries relates to the potential for loss
arising from amendments made to legislation – in particular, labour
legislation, environmental regulations and similar –, which could have
an impact on Corticeira Amorim’s operations and affect its business’
performance and profitability.
The Legal Department in cooperation with the Organisational Development and Strategic Planning area seek to anticipate such amendments
and adapt corporate governance practices accordingly. The numerous
certification processes (food safety, quality, environmental management,
human resources, etc.), as described in more detail in Chapter 5 of the
Management Report, are based on procedures designed, implemented
and regularly and strictly audited by certifying organisations, thus
guaranteeing the minimisation of such risks. Wherever possible and
practicable, the Organisation takes out insurance to mitigate the
effects of uncertain but potentially unfavourable events.
Under the direction of the Board of Directors and assisted by an
Executive Committee or an Executive Director, Corticeira Amorim’s
support divisions play an important role in managing critical risk factors,
including risk prevention and detection. The finance department, the
organisational development department, the management planning
and control department and the internal audit department play an
essential role in this regard.
Financial Risk:
As Corticeira Amorim is one of Portugal’s most international companies,
it pays special attention to managing exchange rate risk as well as
liquidity and interest rate risk.
In addition to the responsibilities of the finance department regarding
prevention, monitoring and management of the above risks, the main
objectives of this department are to assist with the definition and
implementation of global financial strategies and with the coordination of
the financial management of the group’s BUs. It is structured as follows:
×× a Financial Board (FB), which coordinates the financial function
at a central level. The FB is responsible for developing policies
and measures (to be approved by the Executive Committee)
and implementing them, for conducting global dealings with
financial counterparts, for monitoring progress and preparing
regular reports (to the director responsible for the financial
section and to the Executive Committee and the Board of
Directors);
×× Financial Managers who, at the company level, follow the
progress of business deals managing their financial component
in accordance with the advocated policies and measures,
articulating their work performance with the FB.
The financial organisational structure is coordinated as follows:
×× Daily and weekly reports and fortnightly debates on financial
markets and economic developments that may have an impact
on the companies’ business;
×× Regular (monthly) reports on globally agreed conditions;
×× Quarterly meetings of finance managers with a view to reviewing
the current specific state of affairs and defining measures to
be implemented;
×× On the basis of reports submitted to the Board of Directors,
the most important aspects of the financial operations (debt,
investments, liabilities) shall be discussed.
54. Description of the procedure for identification, assessment,
monitoring, control and risk management.
The system of internal control and risk management currently implemented in the company stems from an in-depth and continuous
process of improvement and adaptation of internal reflection in
the company, involving both the Board of Directors, in particular its
Executive Committee, and the different support areas - in particular
the area of Organisational

Development and Strategic Planning - or
the support of external specialised consultants, where appropriate.
Also noteworthy is the Internal Audit area, whose work has significant
impact on reducing the organisation’s operational risks. The main
tasks are to assess and review internal control systems with a view to
optimising resources and safeguarding assets as well as monitoring
activities carried out in order to provide the management bodies with
a reasonable degree of certainty that business goals will be achieved.
The reporting system implemented in the Company – either at regular
intervals or on demand of the Board of Directors, the Executive Committee or officers responsible for the Management – includes both
measurement and objective evaluation of such risks which – after being
discussed by the Board of Directors or the Executive Committee – will,
if appropriate, give rise to the determination of additional or corrective
measures whose implementation and impact will be followed up by
the governing body that approved such measures.
The growing complexity of the business environment triggers off
a close monitoring of the systems implemented in the Company.
Such monitoring includes contributions and opinions from both the
Supervisory Board and the Statutory Auditor and this leads to the
adoption of more effective procedures when it is deemed advisable.
Under the Rules of Procedure of the Supervisory Board, it is this Board’s
responsibility to monitor the effectiveness of the risk management
system, the internal control system and the internal auditing system.
55. Core details on the internal control and risk management
systems implemented in the company regarding the procedure
for reporting financial information (Article 245-A/1/m).
In regard to the preparation and disclosure of financial information - including the consolidated, the Company promotes close
cooperation among all those involved in the process to ensure that:
×× Disclosure complies with all applicable legal requirements and
best practices in terms of transparency, relevance and reliability;
×× The information has been properly checked both internally
and by the appropriate supervisory bodies;
85
×× The information has been approved by the appropriate
governing body;
×× Receipt and centralisation of all questions and queries raised
by investors and answers to such questions;
×× Its public disclosure complies with all relevant legal requirements and recommendations, specifically those of the
CMVM and is made in the following order: first, via the data
dissemination system of the Portuguese Securities Market
Commission (www.cmvm.pt); second, via the Company’s website
(www.corticeiraamorim.com); third, by means of a long list of
Portuguese and foreign media contacts; and fourth, to Corticeira
Amorim’s staff and to shareholders, investors, analysts and
other stakeholders, whose contacts are stored in a database.
×× Participation in conferences and meetings with investors
and analysts.
The process of preparation of financial information, including consolidated information, is dependent on the process of registration of
the operations and the support systems. There is an Internal Control
Procedures Manual and Accounting Manual, approved by the Board
and which is mandatorily adopted by all companies of the Corticeira
Amorim Group. These manuals contain a set of policies, rules and
procedures to (i) ensure that the process of preparation of financial
information follows homogeneous principles and (ii) the quality and
reliability of the financial information is ensured.
The implementation of accounting policies and internal control
procedures relating to the preparation of financial information is
subject to evaluation by the internal and external auditors.
The consolidated financial information by Business Unit is assessed,
validated and approved by the management of the respective Business
Unit, every quarter. This procedure has been consistently adopted by
all the Corticeira Amorim Group’s business units.
The consolidated financial information of Corticeira Amorim is approved
by the Board of Directors and presented to the Supervisory Board,
before its publication.
It is also to be emphasized that the referred Internal Control Procedures
Manual contains a set of rules intended to ensure that the process of
disclosure of financial information, including consolidated information,
guarantees the quality, transparency and fairness in the dissemination
of information.
IV. In ve stor Ass istance
56. Department responsible for investor assistance, composition,
functions, the information made available by said department and
contact details.
Through its Investor Relations Department, Corticeira Amorim
maintains permanent contact with the Market, thus ensuring that the
principle of equality among shareholders is upheld and that uneven
access of investors to information is prevented.
This Department, headed by the Investor Relations Officer, brings
together and coordinates the work of professionals from other
departments (Management Control, Legal and tax, Administrative and
financial) of Corticeira Amorim in order to provide impartial and timely
replies to all requests from investors (whether existing or potential).
Role:
The Investor Relations Department, supervised by Corticeira Amorim’s
Investor Relations Officer, has the following responsibilities:
×× Regular publication of the Company’s operation performance
evaluation reviews and financial results, including co-ordination
and preparation of their twice-yearly public presentation
delivered at the Company’s registered office (either in person
or via conference call);
×× Disclosure of privileged information;
×× Disclosure of information on qualifying interests;
86
The following measures carried out in 2015 in the context of contact
with investors are especially noteworthy:
×× Presentation of annual business activity and results via audioconferencing, thereby promoting interaction in the disclosure
of that information;
×× One-on-one meetings held by invitation on the premises of
investment banks;
×× Participation in international road shows;
×× Meetings held on the Company’s premises with investors
and teams of analysts, to whom the major industrial facilities
were presented.
Corticeira Amorim has been using its information technology to
regularly disclose and disseminate its economic and financial information,
including the Company’s operation performance evaluation reports
and financial results as well as its answers to specific questions and
queries raised by investors.
Type of information made available (in Portuguese and English):
×× The name of the Company, its public company status, registered office and other information set out in article 171 of the
Portuguese Companies’ Code;
×× Articles of Association;
×× Identification of the members of the Company’s governing
bodies and the investor relations officer;
×× The Office of Investor Assistance, its functions and means of
accessing this Office;
×× Financial statements, including an annual report on the
corporate governance structure and practices;
×× Six-month calendar of corporate events released at the
beginning of each half-year;
×× Notices to members of Annual General Meetings to be given
during a 21-day period prior to the date fixed for each meeting;
×× Motions submitted for discussion and vote at a General Meeting
during a 21-day period prior to the date fixed for the meeting;
×× Absentee voting form;
×× Proxy form for Annual General Meetings;
×× Disclosure of biannual and quarterly information on the
Company’s business affairs;
×× Press releases: financial results, confidential information,
qualifying interests in the share capital of the Company;
×× Business presentations to investors and market analysts.
From the beginning of 2009 onwards, the minutes of the General
Meetings and statistical information on the attendance of shareholders
at the General Meetings are also made available for consultation within
five working days of the holding of the Annual General Meeting.
Contact information:
This Department can be reached by telephone at +351 22 747 54 00, by
fax +351 22 747 54 07 or by e-mail at corticeira.amorim@amorim.com.
57. Investor Relations Officer.
The post of Investor Relations Officer of Corticeira Amorim is held
by Cristina Rios de Amorim Baptista.
58. Data on the extent and deadline for replying to the requests
for information received throughout the year or pending from
preceding years.
The response rate to requests for information is 100%. The reply is
provided, on average, within 24 hours (working days), except for
highly complex cases (reply within five working days) that require
consultation with external resources to the Company and are, therefore,
dependent on the deadlines for the reply from such resources. Such
cases accounted for less than 5% of all information requests received
in 2015. At the end of 2015 there were no unanswered requests.
V. We bsite
59. Address.
Corticeira Amorim provides a vast range of information on its website
www.corticeiraamorim.com about its corporate structure, business
activity and the development of its business.
60. Place where information on the firm, public company status,
headquarters and other details referred to in Article 171 of the
Commercial Companies’ Code is available.
http://www.amorim.com/investidores/informacao-institucional/
estruturas-juridica/
61. Place where the articles of association and rules of procedure
of the boards and/or committees are available.
Articles of Association:
estruturas-juridica/
Rules of procedure of the Supervisory Board:
orgaos-sociais/
62. Place where information is available on the names of the
corporate boards’ members, the Investor Relations Officer, the
Office of Investor Assistance or comparable structure, respective
functions and contact details.
Holders of corporate positions:
orgaos-sociais/
Investor Relations Officer:
The Office of Investor Assistance, its duties and means of accessing
this Office:
63. Place where the documents are available and relate to financial
accounts reporting, which should be accessible for at least five years
and the half-yearly calendar on company events that is published
at the beginning of every six months, including, inter alia, general
meetings, disclosure of annual, half-yearly and where applicable,
quarterly financial statements.
Accounting reports:
http://www.amorim.com/investidores/relatorio-e-contas/
http://www.amorim.com/investidores/resultados/
Half-yearly calendar of company events:
http://www.amorim.com/investidores/calendario-de-eventos/
64. Place where the notice convening the general meeting and
all the preparatory and subsequent information related thereto
is disclosed.
assembleia-geral/
65. Place where the historical archive on the resolutions passed at
the company’s General Meetings, share capital and voting results
relating to the preceding three years are available.
assembleia-geral/
Lunch Box , A morim i n partnersh ip with NABA and T12 L ab
87
D.
REMUNERATION
I. P ower to e stablish
66. Details of the powers for establishing the remuneration of
corporate boards, members of the executive committee or chief
executive and directors of the company.
It is the responsibility of the Annual General Meeting to appoint a
Remuneration Committee. The ability and capacity of the members
of the Committee to perform the duties assigned to them in an
independent manner for their entire term of office, i.e. to determine
the remuneration policy of the members of the governing bodies
that shall foster over the medium and long-term the alignment of the
interests with those of the Company.
The adoption of the balanced scorecard methodology, which assesses
performance using both financial and non-financial measures, enables the Remuneration Committee to evaluate every financial year,
whether or not goals are achieved and to what degree. The balanced
scorecard serves also as the basis for preparation of the reports of
the Remuneration Committee and the Board of Directors on the
remuneration policy for members of the Board and the supervisory
board as well as on the remuneration policy for other senior executives
and officers, respectively, to be submitted every year to the Annual
General Meeting for approval.
Thus,
×× the Remuneration Committee of Corticeira Amorim is
responsible for setting the fixed and variable remuneration
to be awarded to members of the Board of Directors, and also
setting the remuneration to be awarded to members of the
remaining governing bodies;
×× The Board of Directors of Corticeira Amorim is responsible
for setting the fixed and variable remuneration to be awarded
to its officers.
Pursuant to the Articles of Association of Corticeira Amorim, the task
of this Committee is to decide on the fixed remuneration to be paid
to the members of the Presiding Board of the General Meeting, the
Supervisory Board and the Statutory Auditors. It is also responsible
for deciding on the remuneration of each director, which directors’
remuneration consists of profit sharing as well as the percentage
attributable to each of these.
The members of Corticeira Amorim’s Remuneration Committee
should not be formally considered independent from the Board of
Directors. However, it is generally believed – particularly by the Annual
General Meeting which elected the Committee members – that they
have adequate technical skills, practical experience and balanced
personality to enable them to fully and effectively discharge their role.
68. Knowledge and experience in remuneration policy issues by
members of the Remuneration Committee.
Members of the Remuneration Committee were selected on the basis
of their wide experience in managing human resources, monitoring
and benchmarking other companies’ remuneration policies and their
knowledge in terms of best remuneration practices and labour law.
Professional qualifications of each member of the Remuneration
Committee and other important curricular information:
José Manuel Ferreira Rios (Chairman):
of Oporto, Faculty of Economics and attended the third year of law
school at the Catholic University of Oporto. Attended various safety
and human resources courses organised by the Portuguese Insurance
Association (Associação Portuguesa de Seguros), between 2005 and
2008. Has held director posts in several companies since 1975 including,
among others, leadership in the area of human resources. Manager
and responsible for the management of information technology,
information systems, human resource management and performance
analysis and assessment (1999 to date, in the company: OSI – Sistemas
Informáticos e Electrotécnicos, Lda). Head of the Corporate Department
of Asset and Human risk analysis, of the Amorim Group, from 2002
to the present date.
Álvaro José da Silva (Member):
of Porto; Post graduation course in Finances, from ISAG. Held the post
of manager of the Studies, Information and Control Office of Portucel
(1978-1983); Financial Director of Isopor Portugal and Dow Chemical
Portugal (1983 – 1989). Head of the Consolidation and Management
Control Department of the Amorim Group, from 1989 to the present
date. Speaker at various training courses.
II. Remuneration Commit tee
67. Composition of the remuneration committee, including details
of individuals or legal persons recruited to provide services to
said committee and a statement on the independence of each
member and advisor.
Pursuant to the Articles of Association, the Remuneration Committee
has three members, who will choose the respective President, positions
held by:
Chairman: José Manuel Ferreira Rios;
Member: Álvaro José da Silva;
Member: Rui Fernando Viana Pinto
pursuant to law.
Extensive knowledge of the labour market and employment practices
and remuneration. Attended various courses and seminars that address
these issues, in particular the issues of pay per performance.
Rui Fernando Viana Pinto (Member):
Accounting and auditing course of Instituto Superior de Contabilidade
e Administração do Porto. Worked as an auditor in the company Burton
& Meyer (1976) and as a tax inspector of the Tax Inspection Service
of the Directorate-General for Taxation (DGCI)/Ministry of Finance
(1978-1989). Has held the post of manager of the Tax Department of
the Amorim Group, from 1989 to the present date.
Knowledge of the labour market and employment practices, in particular
the associated tax issues.
III. Remuneration struct ure
No natural or legal person was hired to assist the Remuneration
Committee.
The Remuneration Committee met four times in 2015, with the attendance
of all the members in office.
88
69. Description of the remuneration policy of the Board of Directors
and Supervisory Boards as set out in Article 2 of Law No. 28/2009
of 19 June.
Under the proposal submitted by the Company’s Remuneration
Committee, the General Shareholders’ Meeting held on 24 March
2015 approved the following remuneration policy:
1. The remuneration of the Members of the Supervisory Board
is in the form of an attendance fee. This is established for the
entire term of office, considering the characteristics of the
Company and market practices;
2. The members of the Board of Directors shall be paid adequate
remuneration taking into account:
×× The individual remuneration package agreed upon
between the Company and each Director;
×× The Company’s remuneration policy does not provide
for the allotment of shares and/or options to acquire
shares or based on share price variation or any retirement benefit scheme to members of the governing
bodies.
70. Information on how remuneration is structured so as to enable
the aligning of the interests of the members of the Board of
Directors with the company’s long-term interests and how it is
based on the performance assessment and how it discourages
excessive risk taking.
The remuneration policy approved by the General Meeting and
described in section 69 is fully adopted.
×× Whenever such is adequate and feasible, such remuneration shall primarily consist of a fixed pay (for
executive and non-executive directors) plus a variable
pay (for executive directors only) as performance-based
premium;
71. Reference, where applicable, to there being a variable
remuneration component and information on any impact of the
performance appraisal on this component.
described in section 69 is fully adopted. The executive members of
the Board of Directors earn a variable remuneration component which
depends on the evaluation of their performance, in particular the
respective contribution either to the profit obtained in the financial
year in question or to comply with goals and implementation of the
strategies defined by the Company for the medium/long term (results,
innovation, financial soundness, value creation, competitiveness and
growth).
×× The award of the variable pay component of remuneration to the executive members of the Board of Directors
shall be a performance bonus, resulting from the
degree of compliance with the goals, objectives and
strategic initiatives and priority actions defined in a
three-year plan, with the respective annual variations.
This will ensure the weighing up of financial and nonfinancial indicators for performance assessment as well
as the short-term performance with the contribution
of the annual performance to medium / long term
economic sustainability of the Organisation;
72. The deferred payment of the remuneration’s variable component
and specify the relevant deferral period.
described in section 69 is fully adopted. In those terms, the payment
of the variable pay component, if any, may be made wholly or in part
after determination of the profit (or loss) for the years in respect of
the whole term of office. There is, therefore, the possibility of the
variable pay being reduced if the profit for the year reflects a significant
deterioration in the Company’s performance in the last financial year
or if it is expectable that a significant deterioration will occur in the
financial year underway.
×× The actual amount of the variable pay shall depend
on the appraisal to be carried out every year by the
Remuneration Committee on the performance of the
Board members, examining the contribution of each
individual executive director to both the Company’s
profit in the relevant financial year and compliance
with the Company’s targets and implementation
of the medium/long-term strategies adopted by
the Company; the development of the results and
the level of compliance with the following strategic
objectives: innovation, financial soundness, value
creation, competitiveness and growth;
In the financial year under review there were no deferred payments
of part of variable component of remuneration as the deterioration
referred to in the previous paragraph did not occur.
×× The payment of the variable pay component, if any,
may be made wholly or in part after determination
of the profit (or loss) for the years in respect of the
whole term of office. There is, therefore, the possibility
of the variable pay being reduced if the profit for
the year reflects a significant deterioration in the
Company’s performance in the last financial year or
if it is expectable that a significant deterioration will
occur in the financial year underway;
74. The criteria whereon the allocation of variable remuneration
as stock options is based and details of the deferral period and
the exercise price.
Variable remuneration in the form of stock options as described in
this section does not exist.
×× Observance of the principles of internal equity
and external competitiveness, taking into account
relevant information disclosed by the main Portuguese
economic groups on their remuneration policies
and practices;
×× The members of the Board of Directors are prohibited
from concluding contracts with the Company or with
its subsidiaries and/or companies in which it holds
an interest, which may mitigate the risk inherent to
the variability of the remuneration as determined by
the Company;
73. The criteria whereon the allocation of variable remuneration
as shares is based, and also on maintaining company shares
that the executive directors have had access to, on the possible
share contracts, including hedging or risk transfer contracts, the
corresponding limit and its relation to the total annual remuneration
value.
Variable remuneration in the form of shares as described in this section
does not exist.
75. The key factors and grounds for any annual bonus scheme and
any additional non-financial benefits.
There are no other systems of annual bonus or other non-cash benefits
besides those identified in the previous sections.
76. Key characteristics of the supplementary pensions or early
retirement schemes for Directors and state date when said schemes
were approved at the general meeting, on an individual basis.
There are no supplementary pensions or early retirement schemes.
89
As mentioned in section 69, the Remuneration Committee of Corticeira
Amorim submitted to the General Meeting held on 24 March 2015
the remuneration policy for the members of the Board of Directors.
This proposal, which was approved, expressly stated that the award
of the benefits referred to in this note is not the remuneration policy.
Although no retirement benefit systems similar to the ones described
in this subsection were in place in the Company on the date hereof,
should their implementation be proposed, the General Assembly shall
assess the characteristics of the systems adopted and in force in the
respective financial year ( just as it assessed the non-assignment).
IV. Remuneration d isclosure
77. Details on the amount relating to the annual remuneration
paid as a whole and individually to members of the company’s
Board of Directors, including fixed and variable remuneration and
as regards the latter, reference to the different components that
gave rise to same.
In the 2015 financial year, all the members of the Board of Directors
earned remunerations from Corticeira Amorim amounting to EUR
590,497.15:
×× the executive members earned fixed remunerations amounting
to EUR 453,477.15 (António Rios de Amorim: EUR 208,722.89;
Nuno Filipe Vilela Barroca de Oliveira: EUR 117,512.89; Fernando
José de Araújo dos Santos Almeida: EUR 127,242.13 euros) and
variable remuneration – corresponding to a performance
bonus arising from the appraisal of the development of the
results and compliance with the following strategic objectives:
innovation, financial soundness, value creation, competitiveness
and growth - which amounted to EUR 137,020.00 (António
Rios de Amorim: EUR 50,500.00; Nuno Filipe Vilela Barroca de
Oliveira: EUR 25,500.00; Fernando José de Araújo dos Santos
Almeida: EUR 61,020.00);
×× the non-executive members of this Board did not receive any
remuneration for the performance of their roles on the Board
of Directors of Corticeira Amorim.
As at 31 December 2015, there were no deferred payments of fixed or
variable remunerations.
78. Any amounts paid, for any reason whatsoever, by other companies
in a control or group relationship, or are subject to a common control.
In the 2015 financial year none of the members of the Board of Directors
have earnings from other associate or affiliated companies included
in the consolidation of Corticeira Amorim.
The companies in a control relationship with Corticeira Amorim, SGPS,
S.A. - for the performance of administration duties in those same
companies - paid remunerations to Cristina Rios de Amorim Baptista:
fixed remuneration of EUR 192 342.13 and variable remuneration of EUR
70 830.00 and to Luísa Alexandra Ramos Amorim: fixed remuneration
of EUR 56 500.00.
79. Remuneration paid in the form of profit sharing and/or bonus
payments and the reasons for said bonuses or profit sharing being
awarded.
The variable component of the remuneration package for Directors
is similar to a performance bonus and is contingent on the degree of
compliance with the Company’s strategic targets, goals and initiatives
and its three-year priority action plan and annual variations. Of note
for this purpose were, among others, the analysis of the development of the results and the level of compliance with the following
strategic objectives: innovation, financial soundness, value creation,
competitiveness and growth.
The amounts paid to the members of the Board of Directors pursuant
to this section are broken down in section 77.
90
80. Compensation paid or owed to former executive Directors
concerning contract termination during the financial year.
No compensation was paid or is owed to former Directors regarding
the termination of their duties in 2015.
81. Details of the annual remuneration paid, as a whole and individually,
to the members of the company’s supervisory board for the purposes
of Law No. 28/2009 of 19 June.
In the 2015 financial year, all the members of the Supervisory Board
have earnings which amounted to EUR 40,800,00 (Manuel Carvalho
Fernandes: EUR 12,000.00; Ana Paula Africano de Sousa e Silva: EUR
9,600.00; Eugénio Luís Lopes Franco Ferreira: EUR 9,600.00; Durval
Ferreira Marques: EUR 9,600.00). Under the remuneration policy set
out herein, the members of the Supervisory Board did not earn any
variable remuneration.
82. Details of the remuneration in said year of the Chairman of the
Presiding Board to the General Meeting.
The Chairman and the Secretary of the Board of the General Meeting
earned EUR 10,000.00 and EUR 3,000.00, respectively.
V. Agree ments with remuneration implications
83. The envisaged contractual restraints for compensation payable
for the unfair dismissal of Directors and the relevance thereof to
the remunerations’ variable component.
No contractual restraints are envisaged in accordance with this section.
84. Reference to the existence and description, with details of the
sums involved, of agreements between the company and members
of the Board of Directors and managers, pursuant to Article 248-B/3
of the Securities’ Code that envisages compensation in the event
of resignation or unfair dismissal or termination of employment
following a takeover bid. (art. 245-A/1/l).
There are no agreements according to the terms set out in this
section. No agreements providing for the payment of compensations
to the Company’s directors and officers (other than where required
by law) have been entered into by and between the Company and its
Directors or Officers.
VI. Share Award and/or Sto ck Option Pl ans
85. Details of the plan and the number of persons included therein.
No share award or stock option plans exist.
86. Characteristics of the plan (award conditions, non-transfer of
share clauses, criteria on share pricing and the exercising option
price, the period during which the options may be exercised, the
characteristics of the shares or options to be awarded, the existence
of incentives to purchase and/or exercise options).
Pursuant to the remuneration policy approved at the General Meeting
and as described in section 85, there are no share award or stock
option plans.
The Company believes that if plans of this type are to be implemented,
the General Meeting should consider the characteristics of the plans
to adopt, as well as their achievement in each financial year.
87. Option rights to acquire shares (“stock options”) granted to
company workers and employees.
None exist.
88. Control mechanisms for a possible employee-shareholder
system inasmuch as the voting rights are not directly exercised
by said employees (Article 245-A/1/e)).
Control mechanisms of this type do not exist.
E.
RELATED
PARTY
TRANSACTIONS
I. Control mechanisms and pro cedure s
89. Mechanisms implemented by the Company for the purpose of
controlling transactions with related parties.
All business conducted by the Company with related parties respects
the interests of the Company and its subsidiaries, it is examined by
the competent body of the Business Unit that is a counterparty in
the transaction and undertaken (i) in normal market conditions or
(ii) when the specificity of transactions does not allow to determine
this value by using the cost-plus criterion, with margins in the range
2%-5%. Business of significant value (transaction greater than EUR 1
million) or, by their nature, of particular relevance to the Company,
is analysed by the Executive Committee and/or Board of Directors.
91. A description of the procedures and criteria applicable to the
supervisory body when same provides preliminary assessment of
the business deals to be carried out between the company and
the holders of qualifying interests or entity-relationships with the
former, as envisaged in Article 20 of the Securities’ Code.
II. Data on busine ss de al s
92. Details of the place where the financial statements including
information on business dealings with related parties are available,
in accordance with IAS 24, or alternatively a copy of said data.
The transactions of Corticeira Amorim with related parties are,
in general, due to the provision of services by the subsidiaries of
AMORIM - INVESTIMENTOS E PARTICIPAÇÕES, SGPS, S.A., (Amorim
Serviços e Gestão, S.A., Amorim Viagens e Turismo, Lda., OSI – Sistemas
Informáticos e Electrotécnicos, Lda.). The total of services provided
by these companies to the companies of Corticeira Amorim was
EUR 7.627 million. The value of transactions in the opposite direction
was EUR 116,900.
The sales of Quinta Nova, S.A., a subsidiary of AMORIM - INVESTIMENTOS
E PARTICIPAÇÕES, S.G.P.S., S.A., to the companies of the universe
of Corticeira Amorim totalled EUR 23,000 (2014: EUR 42,000). The
transactions in the opposite direction amounted to EUR 79,900.
Purchases of cork (reproduction cork) during the year from companies
owned by the major indirect shareholders of Corticeira Amorim
amounted to EUR 1.317 million, corresponding to less than 2% of total
purchases of that raw material.
In accordance with the regulation on transactions with holders of
qualifying holdings[3] approved and in force from 1 August 2014,
conducting transactions with holders of qualifying holdings and/or
related entities should be subject to prior opinion of the Supervisory
Board in the following cases:
i. Transactions whose value per transaction exceeds one
million euros or where the value accumulated during the
year exceeds three million euros. The prior opinion of
the Supervisory Board will not be necessary for continuous implementation contracts or renovations in terms
substantially similar to those of the contract previously
in force;
ii. Transactions with a significant impact on the business
activity of Corticeira Amorim and/or its subsidiaries
due to their nature or strategic importance, regardless
of the original value;
iii.Transactions exceptionally undertaken, outside of normal
market conditions, regardless of the respective value.
The assessment to be made under the authorisation procedures and
prior opinion applicable to transactions with holders of qualifying
holdings and/or related entities shall take into account, among other
relevant aspects and according to the specific case, the principle of
equal treatment of shareholders and other stakeholders, the pursuit
of the interests of the Company, as well as the impact, materiality,
nature and justification of each transaction.
The value of these transactions is disclosed annually in the Consolidated
Annual Report and Accounts of Corticeira Amorim (section 92 herein).
90. Details of transactions that were subject to control in the
referred year.
In the year under review there were no transactions subject to the
prior opinion of the Supervisory Board.
3
In spite of the fact the approved rules on transactions with holders of qualifying holdings and
in force from 1 August 2014, are not available to the public, the relevant content of the same is
reported in this note 89.
Wicanders CorkComfort at the C AP C - Musée d’Art
Conte mpora in de Bordeau x
91
PART II
CORPORATE
GOVERNANCE
ASSESSMENT
1.
Details of
the Corporate
Governance
Code implemented
In matters of corporate governance Corticeira Amorim is governed
by: (i) current Portuguese legislation, in particular the Portuguese
Companies’ Code, Portuguese Securities’ Code and the regulations
issued by the Portuguese Securities Market Commission (CMVM), which
may all be accessed on the CMVM’s website: www.cmvm.pt; (ii) its own
articles of association, which are available on the Company’s website
at: http://www.amorim.com/investidores/informacao-institucional/
estruturas-juridica/; and (iii) the 2013 CMVM Corporate Governance
Code as referred to in the CMVM Regulation no. 41/2013 and which,
despite just being a recommendatory framework, is an important
benchmark of good practice, which is also available at www.cmvm.pt.
Corticeira Amorim assesses its practices in relation to the aforementioned Corporate Governance Code on a ‘comply or explain’ basis.
This report on Corticeira Amorim’s corporate governance structures
and practices is benchmarked against all legislation, regulations and
recommendations to which our Company is subject.
2.
Analysis of
compliance with
the Corporate
Governance Code
implemented
I. VOTING AND CORP ORATE CONTROL
I.1. Companies shall encourage shareholders to attend and vote at
general meetings and shall not set an excessively large number of
shares required for the entitlement of one vote, and implement
the means necessary to exercise the right to vote by mail and
electronically.
Complies. Sections: 12, 13 and 56.
I.2. Companies shall not adopt mechanisms that hinder the passing
of resolutions by shareholders, including fixing a quorum for
resolutions greater than that provided for by law.
Does not comply. Section 14.
Garrett Macna m ara’s cork surf board, a partnersh ip with Mercedes-Benz
92
The Articles of Association of Corticeira Amorim enshrine a quorum
for calling meetings to order/taking decisions that is greater than that
established in law[4] in the following situations:
×× Restriction or withdrawal of pre-emption rights in share capital
increases – the Company’s articles of association require that
the Annual General Meeting be attended by shareholders
accounting for at least 50 per cent of the paid-up share
capital (article 7);
×× Removal of a director elected under the special provisions set
out in article 392 of the Portuguese Companies’ Code - in order
that a resolution on this issue may be adopted, it is necessary
that shareholders accounting for at least 20 per cent of the
share capital shall not vote against the resolution to remove
a Director from office (article 17);
×× In order that resolutions may be passed at an Annual General
Meeting convened by shareholders, the meeting shall be
attended by members holding shares equivalent to the minimum
amount required by law to justify the calling of such a meeting
(article 22);
×× Change in the composition of the Board of Directors – this
resolution must be approved by shareholders accounting for
at least two-thirds of the share capital (article 24);
×× Winding-up of the Company – this resolution must be approved
by shareholders accounting for at least 85 per cent of the
paid-up share capital (article 33).
I.3. Companies shall not establish mechanisms intended to
cause mismatching between the right to receive dividends or
the subscription of new securities and the voting right of each
common share, unless duly justified in terms of long-term interests
of shareholders.
Complies. Section 12.
I.4. The company’s articles of association that provide for the
restriction of the number of votes that may be held or exercised
by a sole shareholder, either individually or jointly with other
shareholders, shall also foresee for a resolution by the General
Assembly (5 year intervals), on whether that statutory provision is
to be amended or prevails – without super quorum requirements
as to the one legally in force – and that in said resolution, all votes
issued be counted, without applying said restriction.
Not applicable. The Company Articles of Association do not provide
for limitations on the number of votes that may be held or exercised
by a shareholder, either separately or jointly with other shareholders.
Section 13.
I.5. Measures that require payment or assumption of fees by
the company in the event of change of control or change in the
composition of the Board and that which appear likely to impair
the free transfer of shares and free assessment by shareholders of
the performance of Board members, shall not be adopted.
Complies partially. The Company concluded financing contracts
with possible early repayment in the event of a change in shareholder
control. No measures have been implemented specifically targeting
the effects described in this recommendation. Sections 4 and 84.
II. SUPERVISION, M ANAGE MENT AND OVER SIGHT
Therefore, non-compliance with the CMVM’s Recommendation and
the requirement of a higher quorum than that provided for by the
Portuguese Companies’ Code gives shareholders - particularly small
or minority shareholders - an important role in a number of decisions
that can have significant impact on corporate life (winding-up),
corporate governance model (removal of a Director proposed by
minority shareholders and change in the composition of the Board of
Directors), ownership rights of shareholders (restriction or abolition
of shareholders’ pre-emptive subscription rights in share capital
increases) and an appropriate participation in Annual General Meetings
convened by shareholders.
Thus, after reviewing the above considerations, we are of the
opinion that keeping these conditions will contribute to enhance
and protect shareholders’ rights and role in respect of significant
corporate governance matters – values that the Corporate Governance Code seeks to protect.
4
The Portuguese Companies’ Code establishes the following requirements for valid decisionmaking at the general meeting:
Quorum (article 383):
1. On first convening, resolutions may be passed at an Annual General Meeting regardless of the
number of members present in person or by proxy, unless otherwise laid down in the following
paragraph or in the Company’s articles of association.
2.On first convening, the Annual General Meeting can pass resolutions to amend the Company’s
articles of association or the Company’s merger, de-merger, transformation or winding-up or
any other matters in respect of which an unspecified qualified majority is required by law, if
shareholders jointly holding at least one third of the Company’s share capital are present in person
or by proxy at such meeting.
3.On second convening, resolutions may be passed at an Annual General Meeting regardless of the
number of members present in person or by proxy at the meeting or the Company’s share capital
held by such members.
Majority (article 386):
1. Resolutions at an Annual General Meeting shall be passed by a simple majority of the votes cast,
regardless of the percentage of share capital held by the members attending the meeting, unless
otherwise provided for by law or in the Company’s articles of association; abstentions are not counted.
1. In the event of competing motions for appointment of members to the governing bodies or
appointment of statutory auditors or statutory audit firms, the motion receiving the highest
number of votes will win.
1. Resolutions on any matter specified in section 383(2) must be carried by a majority of two-thirds of
the votes cast, regardless of whether the meeting is convened for the first or for the second time.
1. On second convening, resolutions on any matter specified in section 383(2) may be carried by a
simple majority of the votes cast by shareholders present in person or by proxy at the meeting and
jointly holding at least half of the Company’s share capital.
II.1. Supervision and Management
II.1.1. Within the limits established by law, and excepting smallsized companies, the Board of Directors shall delegate the daily
management of the company and said delegated powers shall be
identified in the Annual Report on Corporate Governance.
Complies. Sections 27 to 29.
II.1.2. The Board of Directors shall ensure that the company
acts in accordance with its objectives and shall not delegate its
responsibilities as regards the following: i) define the general
strategy and policies of the company, ii) define business structure
of the group, iii) decisions considered strategic due to the amount,
risk and particular characteristics involved.
Complies. As better detailed in section 9, only day-to-day management
can be delegated.
II.1.3. The General and Supervisory Board, in addition to its supervisory
duties, shall take full responsibility at corporate governance level.
Hence, through statutory provision or by equivalent means, the
requirement shall be established for this body to decide on the
strategy and major policies of the company, the definition of the
corporate structure of the group and the decisions that shall be
considered strategic due to the amount or risk involved. This
body shall also assess compliance with the strategic plan and the
implementation of key policies of the company.
Not applicable. The model adopted by Corticeira Amorim does not
include this body, as described in section 15; the powers to define
policy and strategies under this recommendation are powers that
cannot be delegated by the Board of Directors. The Supervisory Board
and the Statutory Auditor have supervisory powers, with the specific
nature arising from the scope of the respective activity.
II.1.4. Except for small-sized companies, the Board of Directors
shall create the necessary committees in order to:
a) Ensure a competent and independent assessment of the
performance of the executive directors and its own overall
performance, as well as of other committees;
93
b) Reflect on the system structure and governance practices
adopted, verify its efficiency and propose to the competent
bodies, measures to be implemented with a view to their
improvement.
II.1.5. The Board of Directors should set goals in terms of risk-taking
and create systems for their control to ensure that the risks effectively
incurred are consistent with those goals.
Moreover, pursuant to the remunerations policy referred to in section 69,
the award of the variable pay component of remuneration corresponds
to a performance bonus, resulting from the degree of compliance
with the goals, objectives and strategic initiatives and priority actions
defined in a three-year plan, with the respective annual variations. This
will ensure the weighing up of financial and non-financial indicators
for performance assessment as well as the short-term performance
with the contribution of the annual performance to medium / long
term economic sustainability of the Organisation.
II.1.6. The Board of Directors shall include a number of non-executive
members ensuring effective monitoring, supervision and assessment
of the activity of the remaining members of the board.
II.1.7. Non-executive members shall include an appropriate number of
independent members, taking into account the adopted governance
model, the size of the company, its shareholder structure and the
relevant free float.
Does not comply.
Although the Board of Directors does not include independent nonexecutive members as recommended by the Corporate Governance
Code, the Company believes that the existence of two supervisory
teams – a supervisory board and a statutory auditor – whose members
are all independent, ensures the interests envisaged by this recommendation are fully and appropriately safeguarded. In addition, it
is believed that the observance of this independence requirement
coupled with the liability regime for members of the Supervisory
Board, meet the conditions necessary to ensure effective supervision
to a high standard of impartiality, rigour and independence.
II.1.8. When board members that carry out executive duties are
requested by other board members, said shall provide the information
requested, in a timely and appropriate manner to the request.
II.1.9. The Chairman of the Executive Committee shall provide the
Chairman of the Board of Directors, the Chairman of the Supervisory
Board with the notice of meetings and respective minutes.
II.1.10. If the chair of the Board of Directors carries out executive
duties, said body shall appoint, from among its members, an
independent member to ensure the coordination of the work of
other non-executive members and the conditions so that said can
make independent and informed decisions or to ensure the existence
of an equivalent mechanism for such coordination.
Does not comply.
The Board of Directors of Corticeira Amorim does not include independent non-executive members, so it is not possible to establish the
relationship on the terms set out in this recommendation.
Nonetheless, the Company believes that the procedures described in
section 21 of this report constitute a system that in practice ensures
the fulfilment of the goals advocated by this recommendation.
II.2. Supervision
II.2.1. Depending on the applicable model, the Chair of the Supervisory
94
Board shall be independent in accordance with the applicable
legal standard, and have the necessary skills to carry out their
relevant duties.
II.2.2. The supervisory body shall be the main representative of the
external auditor and the first recipient of the relevant reports, and
is responsible, inter alia, for proposing the relevant remuneration
and ensuring that the proper conditions for the provision of services
are provided within the company.
Does not comply.
The Supervisory Board is responsible for proposing the Statutory
Auditor. It was the Board of Directors who approved its remuneration
in the year under review, while the Financial Board was responsible for
ensuring the adequate conditions for provision of the services. This
segmentation allows, it is believed, the reasonable safeguarding
of the interests that this recommendation protects.
Therefore, the non-adoption of the recommendation stems from the
implementation of a scheme of dialogue and representation with the
External Auditor which also guarantees the protection of the interests
covered by it. In fact, the removal of issues more of a bargaining nature
from the scope of the Supervisory Board/External Auditor relationship,
as is the case of fees (but not the scope or extent of the work) facilitates
the relationship between these independent and supervisory bodies
of the Company. Moreover, the Supervisory Board takes a decision
on the work performed by the Statutory Auditor at the end of each
financial year. The Company discloses that opinion together with the
other accounting documents.
This practice was reviewed in 2014 (by the Executive Committee).
It was decided to continue to favour the independence of the two
supervisory bodies from each other, keeping the procedures described
in this section.
II.2.3. The supervisory board shall assess the external auditor on
an annual basis and propose to the competent body its dismissal
or termination of the contract as to the provision of their services
when there is a valid basis for said dismissal.
Complies. Sections 38 and 40.
II.2.4. The supervisory board shall assess the functioning of the
internal control systems and risk management and propose
adjustments as may be deemed necessary.
II.2.5. The Audit Committee, the General and Supervisory Board
and the Supervisory Board decide on the work plans and resources
concerning the internal audit services and services that ensure
compliance with the rules applicable to the company (compliance
services), and should be recipients of reports made by these
services at least when it concerns matters related to accountability,
identification or resolution of conflicts of interest and detection
of potential illegalities.
The head of the Internal Audit Department meets quarterly with
the Supervisory Board of the Company, to present and discuss the
annual work plan, the resources allocated and the actions undertaken,
particularly through the preparation and discussion of a report
describing the implementation of such plan the work carried out and
the conclusions of such actions.
II.3. Definition of Remunerations
II.3.1. All members of the Remuneration Committee or equivalent
should be independent from the executive board members and
include at least one member with knowledge and experience in
matters of remuneration policy.
The members of Corticeira Amorim’s Remuneration Committee
should not be formally considered independent from the Board of
Directors. However, it is generally believed – particularly by the Annual
General Meeting which elected the Committee members – that they
have adequate technical skills, practical experience and balanced
personality to enable them to fully and effectively discharge their
role.
II.3.2. No natural or legal person that provides or has provided
services in the past three years, to any structure under the board
of directors, the Board of Directors of the company itself or who
has a current relationship with the company or consultant of the
company, shall be hired to assist the Remuneration Committee
in the performance of their duties. This recommendation also
applies to any natural or legal person that is related to the above
by employment contract or provision of services.
Complies. No person was hired or contracted according to the terms
of this recommendation.
II.3.3. The statement on the remuneration policy for the members of
the Board of Directors and Supervisory Boards as set out in Article
2 of Law No. 28/2009 of 19 June, shall also contain:
a) Identification and details of the criteria for determining the
remuneration paid to the members of the governing bodies;
Does not comply.
The remuneration policy statement described in section 69 and prepared
in accordance with the provisions of Article 2 of Law 28/2009 of 19 June,
does not include the information envisaged in this recommendation.
b) Information regarding the maximum potential, in individual
terms, and the maximum potential, in aggregate form, to
be paid to members of corporate bodies, and identify the
circumstances whereby these maximum amounts may be
payable;
Does not comply. The statement on remuneration policy
does not contain this information, as described in section 69.
c) Information regarding the enforceability or unenforceability
of payments for the dismissal or termination of appointment
of board members.
Does not comply. The statement on remuneration policy
does not contain this information, as described in section 69.
It is concluded that, as not all the practices listed in recommendation II.3.3 are complied with, recommendation II.3.3.
is deemed to not have been complied with, in accordance
with the interpretation of the Portuguese Securities Market
Commission.
II.3.4. Approval of plans for the allotment of shares and/or
options to acquire shares or based on share price variation to
board members shall be submitted to the General Meeting. The
proposal shall contain all the necessary information in order to
correctly assess said plan.
Not applicable, since the Company has not set up any share or share
options plan. Sections 69, 85 and 86.
II.3.5. Approval of any retirement benefit scheme established
for members of governing bodies shall be submitted to the
General Meeting. The proposal shall contain all the necessary
information in order to correctly assess said system.
Not applicable, since there is no supplementary pensions or early
retirement scheme for members of the corporate bodies. Section 76.
III. RE MUNERATION
III.1. The remuneration of the executive members of the board
shall be based on actual performance and shall discourage taking
on excessive risk-taking.
Pursuant to the remunerations policy referred to in section 69, the
award of the variable pay component of remuneration corresponds
to a performance bonus, resulting from the degree of compliance
with the goals, objectives and strategic initiatives and priority actions
defined in a three-year plan, with the respective annual variations. This
will ensure the weighing up of financial and non-financial indicators
for performance assessment as well as the short-term performance
with the contribution of the annual performance to medium / long
term economic sustainability of the Organisation.
III.2. The remuneration of non-executive board members and the
remuneration of the members of the supervisory board shall not
include any component whose value depends on the performance
of the company or its value.
III.3. The variable component of remuneration shall be reasonable
overall in relation to the fixed component of the remuneration and
maximum limits should be set for all components.
Does not comply.
It must be stressed that current practice clearly reflects a reasonable
balance (Section 77) not only in terms of absolute values but also in
terms of the ratio between fixed and variable remuneration, that there
is only a limit - imposed by the Articles of Association - for the part
that is established as profit sharing, which cannot exceed 3% for the
entire Board of Directors.
III.4. A significant part of the variable remuneration should be
deferred for a period of no less than three years, and the right of
way payment shall depend on the continued positive performance
of the company during that period.
The deferral under the conditions specified in this Recommendation
is not usual practice. It should be emphasized that the award of the
variable component of remuneration to the executive members of the
Board of Directors and Officers of the Company, which represents a
performance bonus, results from the verification of compliance with
the goals, objectives and strategic initiatives and priority actions
defined in a three-year plan, with the respective annual variations,
which safeguards the interests covered by this recommendation,
although for a period not exceeding three years.
III.5. Members of the Board of Directors shall not enter into contracts
with the company or with third parties which intend to mitigate
the risk inherent to remuneration variability set by the company.
III.6. Executive board members shall maintain the company’s shares
that were allotted by virtue of variable remuneration schemes, up to
twice the value of the total annual remuneration, except for those
that need to be sold for paying taxes on the gains of said shares,
until the end of their term of office.
Not applicable.
The Company has not, nor ever had, schemes for awarding shares as
variable remuneration. The remuneration policy also does not envisage
schemes for awarding shares as variable remuneration.
III.7. When the variable remuneration includes the allocation of
options, the beginning of the exercise period shall be deferred
for a period not less than three years.
Not applicable.
The Company has not, nor ever had, schemes for awarding shares as
variable remuneration. The remuneration policy also does not envisage
schemes for awarding shares as variable remuneration.
95
III.8. When the removal of board member is not due to serious
breach of their duties nor to their unfitness for the normal exercise
of their functions but is yet due to inadequate performance, the
company shall be endowed with the adequate and necessary legal
instruments so that any damages or compensation, beyond that
which is legally due, is unenforceable.
Complies.
No legal instrument has been entered into with Directors requiring
the company, as provided for in this Recommendation, to pay any
damages or compensation beyond that which is legally due.
IV. AUDITING
IV.1. The external auditor shall, within the scope of its duties, verify
the implementation of remuneration policies and systems of the
corporate bodies as well as the efficiency and effectiveness of the
internal control mechanisms and report any shortcomings to the
supervisory body of the company.
Does not comply.
Therefore, the interests envisaged in this recommendation are
believed to be fully protected.
V. CONFLIC TS OF INTERE ST AND REL ATED PART Y
TRANSAC TIONS
V.1. The company’s business with holders of qualifying interests or
entities with which they are in any type of relationship pursuant to
article 20 of the Portuguese Securities’ Code, shall be conducted
during normal market conditions.
V.2. The supervisory or oversight board shall establish procedures and
criteria that are required to define the relevant level of significance
of business with holders of qualifying interests - or entities with
which they are in any of the relationships described in article 20/1
of the Portuguese Securities’ Code – thus significant relevant
business is dependent upon prior opinion of that body.
VI. INFOR M ATION
The mandate of the Statutory Auditor does not cover checking the
remuneration policies and systems implemented in the Company. It
is belief of the Board of Directors that the remuneration management system currently implemented ensures compliance with the
remuneration policy adopted by the General Meeting of Shareholders.
As set out in section 39, the performance of all other duties - that
must be diligently and effectively carried out - are the Statutory
Auditor’s responsibility.
IV.2. The company or any entity with which it maintains a control
relationship shall not engage the external auditor or any entity with
which it finds itself in a group relationship or that incorporates the
same network, for services other than audit services. If there are
reasons for hiring such services - which must be approved by the
supervisory board and explained in its Annual Report on Corporate
Governance - said should not exceed more than 30% of the total
value of services rendered to the company.
Does not comply.
The services that the Company contracts from PricewaterhouseCoopers,
which holds the corporate office of Statutory Auditor, and which do
not require the prior approval of the Supervisory Board, primarily
include supporting the implementation of administrative procedures
for complying with formalities established by law and subject to rules
safeguarding potential issues relating to the independence of this
body, as best illustrated in sections 37 and 41.
IV.3. Companies shall support auditor rotation after two or three
terms whether these encompass periods of four or three years,
respectively. Its continuance beyond this period must be based on
a specific opinion of the supervisory board that explicitly considers
the conditions of auditor’s independence and the benefits and
costs of its replacement.
Does not comply.
As set out in section 40, there is no policy of rotation of Statutory
Auditor. Continuation in service of the statutory auditor beyond the
recommended three-year term is subject to a careful assessment of
the advantages and disadvantages, in particular the expertise and
experience acquired in the type of business in which the Company
is engaged in. PricewaterhouseCoopers & Associados, SROC, Lda
meets the independence requirements and, in addition, this firm
of auditors - in line with international best practices - is willing to
rotate the auditor assigned to Corticeira Amorim every seven years.
In addition to a Statutory Auditor, Corticeira Amorim has also a
Supervisory Board consisting wholly of independent members, whose
work cannot be validly performed for a period exceeding three terms.
96
VI.1. Companies shall provide, via their websites in both the
Portuguese and English languages, access to information on
their progress as regards the economic, financial and governance
state of play.
VI.2. Companies shall ensure the existence of an investor support
and market liaison office, which responds to requests from investors
in a timely fashion and a record of the submitted requests and their
processing shall be kept.
Mozelos, 11 February 2016
The Board of Directors of Corticeira Amorim, S.G.P.S.,
Chairman
Vice-Chairman
Member
Member
Member
Juan Ginesta Viñas
Member
Exit, cover ing s with cork , designed by StudioIrv ine for Matteo Brioni
97
04
Consolidated
Financial
Statements
Consolidated Statement of Financial Position (thousand euros)
Notes
Assets
Property, plant and equipment
Investment property
Goodwill
Investments in associates
Intangible assets
Other financial assets
Deferred tax assets
Non-current assets
Inventories
Trade receivables
Income tax assets
Other current assets
Cash and cash equivalents
Current assets
IX
IX
X
V and XI
IX
XI
XII
XIII
XIV
XV
XVI
XVII
Total Assets
December
2015
December
2014
190,352
5,008
0
13,304
2,489
4,177
8,359
223,690
271,705
132,545
3,139
28,678
7,461
443,530
182,893
5,190
2,911
10,841
1,091
3,631
6,708
213,265
247,633
122,606
2,233
25,673
6,036
404,181
667,219
617,446
133,000
0
152,754
55,012
13,368
354,133
133,000
-7,197
140,617
35,756
13,393
315,569
41,211
10,015
32,227
6,743
90,196
50,146
121,184
49,518
2,042
222,890
26,225
11,533
27,951
6,970
72,678
67,369
115,303
44,007
2,520
229,199
667,219
617,446
Equity
Share capital
Treasury stock
Other reserves
Net Income
Non-Controlling Interest
Total Equity
Liabilities
Interest-bearing loans
Other borrowings and creditors
Provisions
Deferred tax liabilities
Non-current liabilities
Trade payables
Income tax liabilities
Current liabilities
Total Liabilities and Equity
XVIII
XVIII
XVIII
XIX
XX
XXII
XXX
XII
XX
XXI
XXII
XXIII
(this statement should be read with the attached notes to the consolidated financial statements)
100
Consolidated Income Statement by Nature – Of the Year and Fourth Quarter
4Q15
4Q14
(non audited)
(non audited)
141,911
71,976
3,339
24,112
30,754
600
2,411
-345
20,565
6,337
14,228
-3
1,126
418
212
32
1,050
14,188
408
13,779
378
13,402
130,655
69,006
8,809
24,698
27,146
-1,166
3,051
2,192
20,639
5,650
14,989
2,840
2,759
769
1,990
56
354
9,801
2,850
6,951
229
6,722
0.101
0.054
(thousand euros)
Notes
2015
2014
Sales
XIX
604,800 560,340
Costs of goods sold and materials consumed
307,375 286,205
Change in manufactured inventories
18,188
9,448
Third party supplies and services
XIX
100,537 96,429
Staff costs
XXV 111,881 103,315
Impairments of assets
XXVI
3,291
149
Other gains
XXVII
8,934
9,613
Other costs
XXVII
8,117
6,581
Current EBITDA
100,720 86,722
Depreciation
IX
25,051 22,336
Current EBIT
75,669 64,386
Non-current costs
XXVI
2,904
6,354
Financial costs
XXVIII
2,847
6,036
Interest Costs
2,139
4,078
Provisions and other fiancial costs
709
1,958
Financial income
XXVIII
58
180
Share of (loss)/profit of associates
XI
3,091
1,280
Profit before tax
73,066 53,456
Income tax
XII
17,496 16,776
Profit after tax
55,570 36,680
Non-controlling Interest
XVIII
558
924
Net Income attributable to the equity holders of Corticeira Amorim
55,012 35,756
Earnings per share - Basic and Diluted (euros per share)
XXXIV
0.431
0.285
Consolidated Statement of Comprehensive Income – Of the Year and Fourth Quarter
4Q15
4Q14
(non audited)
(non audited)
13,779
6,952
-475
197
208
622
0
-279
13,501
0
830
7,782
13,071
7,384
430
398
(thousand euros)
Net Income (before non-controlling Interest)
Itens that could be reclassified through income statement:
Change in derivative financial instruments fair value
Change in translation differences and other
Itens that will not be reclassified through income statement:
Gain in treasury stock sale
Net Income directly registered in Equity
Total Net Income registered
Attributable to:
Corticeira Amorim Shareholders
Non-controlling Interest
2015
2014
55,570
36,680
-124
641
-55
1,502
25,279
25,796
81,366
0
1,447
38,127
81,111
37,303
255
824
CONSOLiDATED FiNANCiAL STATE mENTS —
101
Consolidated Statement Of Cash Flow – Of The Year And Fourth Quarter
4Q15
4Q14
(non audited)
(non audited)
159,726
-128,195
-30,379
1,152
-5,906
22,989
18,235
157,019
-129,576
-27,503
-60
-4,769
25,124
20,295
78
1
82
33
2,095
125
10
9
86
11
3,927
125
-14,145
-31
-1,197
-2,229
-15,188
-6,627
-627
-453
-1,009
-4,548
3,082
0
391
0
0
426
0
-960
-32,597
-96
-30,181
-27,134
21
22,453
-2,166
35
-8,912
-108
-10,725
5,022
11
-10,832
-4,659
-5,799
(thousand euros)
2015
OPERATING ACTIVITIES
Collections from customers
Payments to suppliers
Payments to employees
Operational cash flow
Payments/collections - income tax
Other collections/payments related with operational activities
Cash flow before extraordinary items (1)
INVESTMENT ACTIVITIES
Collections due to:
Tangible assets
Investment property
Other assets
Interests and similar gains
Investment subsidies
Dividends
Payments due to:
Tangible assets
Financial investments
Intangible assets
Cash flow from investments (2)
FINANCIAL ACTIVITIES
Collections due to:
Loans
Sale of treasury stock
Others
Payments due to:
Loans
Interests and similar expenses
Dividends
Others
Cash flow from financing (3)
Change in cash (1) + (2) + (3)
Exchange rate effect
Cash at beginning
Cash at end
2014
642,252 615,763
-514,686 -510,078
-110,261 -105,064
17,305
621
-15,611
-9,479
52,952
72,455
54,646
63,597
484
50
227
64
2,095
287
675
11
189
78
3,927
298
-31,189
-92
-1,617
-2,229
-31,920
-21,216
-2,514
-563
-1,009
-20,124
0
32,927
1,925
0
0
1,984
-2,575
-2,894
-50,509
-428
-21,555
1,171
-31
-5,799
-16,517
-3,690
-24,425
-432
-43,080
393
3
-6,195
-4,659
-5,799
102
Consolidated Statement of Changes in Equity
Balance
Beginning
December 31, 2015
Equity:
Share Capital
(thousand euros)
Changing in Appropriation
perimeter of N-1 profit
Dividends
Net Profit N
Increases /
Reclassif
Decreases /
Reclassif
Translation
Differences
End Balance
133,000
–
–
–
–
–
–
-7,399
–
–
–
–
–
7,399
–
0
201
–
–
–
–
–
-201
–
0
Paid-in Capital
38,893
–
–
–
–
–
–
–
38,893
IFRS Transition
Adjustments
0
–
–
–
–
–
–
–
0
Hedge Accounting
-45
–
–
–
–
–
-124
–
-169
Reserves
Legal Reserve
Other Reserves
12,243
89,300
–
–
2,051
–
33,705 -50,169
–
–
–
25,729
–
25
–
–
14,294
98,590
Translation Difference
226
–
–
–
–
–
919
1,145
Net Profit for the Year
266,419
35,756
13,393
0 35,756 -50,169
– -35,756
–
13
–
-293
0
55,012
558
25,729
–
–
7,099
–
–
919 285,753
– 55,012
-303 13,368
Total Equity
315,569
13
55,570
25,729
7,099
616 354,133
133,000
–
–
–
–
–
–
– 133,000
-7,399
–
–
–
–
–
–
–
-7,399
201
–
–
–
–
–
–
–
201
Paid-in Capital
38,893
–
–
–
–
–
–
–
38,893
IFRS Transition
Adjustments
0
–
–
–
–
–
–
–
0
Hedge Accounting
10
–
–
–
–
–
-55
–
-45
Reserves
Legal Reserve
Other Reserves
12,243
82,886
–
–
–
–
30,339 -23,864
–
–
–
–
–
-61
–
–
12,243
89,300
Translation Difference
-1,445
–
–
–
–
–
1,671
226
Net Profit for the Year
258,389
30,339
13,009
0 30,339 -23,864
– -30,339
–
0
–
-433
0
35,756
924
0
–
–
-116
–
-20
1,671 266,419
– 35,756
-87 13,393
Total Equity
301,737
0
36,680
0
-135
1,584 315,569
Treasury Stock
– Face Value
Treasury Stock
– Disc. and Premiums
–
0 -50,462
– 133,000
December 31, 2014
Equity:
Share Capital
Treasury Stock
– Face Value
Treasury Stock
– Disc. and Premiums
–
1 -24,297
CONSOLiDATED FiNANCiAL STATE mENTS —
103
05
Notes to the
Consolidated
Financial
Statements
I
INTRODUCTION
At the beginning of 1991, Corticeira Amorim, S.A. was transformed into Corticeira Amorim,
S.G.P.S., S.A., the holding company for the cork business sector of the Amorim Group. In this
report, Corticeira Amorim will be the designation of Corticeira Amorim, S.G.P.S., S.A., and in
some cases the designation of Corticeira Amorim, S.G.P.S. together with all of its subsidiaries.
Corticeira Amorim, directly or indirectly, holds no interest in land properties used to grow
and explore cork tree. Cork tree is the source of cork, the main raw material used by Corticeira
Amorim production units. Cork acquisition is made in an open market, with multiple agents,
both in the demand side as in the supply side.
Corticeira Amorim is mainly engaged in the acquisition and transformation of cork into a
numerous set of cork and cork related products, which are distributed worldwide through its
network of sales company.
Corticeira Amorim is a Portuguese company with a registered head office in Mozelos, Santa
Maria da Feira. Its share capital amounts to 133 million euros, and is represented by 133 million
shares, which are publicly traded in the Euronext Lisbon – Sociedade Gestora de Mercados
Regulamentados, S.A.
Amorim Capital - Sociedade Gestora de Participações Sociais, S.A. held 67,830,000 shares
of Corticeira Amorim as of December 31, 2015 corresponding to 51.00 % of its share capital
(December 2014: 67,830,00 shares). Amorim Capital - Sociedade Gestora de Participações
Sociais, S.A. consolidates in Interfamilia II, S.G.P.S., S.A., which is its controlling and mother
company, owned by Amorim family.
These financial statements were approved in the Board Meeting of February 11, 2016. Shareholders
have the capacity to modify these financial statements even after their release.
Except when mentioned, all monetary values are stated in thousand euros (Thousand euros
= K euros = K€).
Some figures of the following notes may present very small differences not only when compared
with the total sum of the parts, but also when compared with figures published in other parts
of this report. These differences are due to rounding aspects of the automatic treatment of
the data collected.
Wicanders Dekwall
106
II
SUMMARY OF
SIGNIFICANT
ACCOUNTING
POLICIES
×× the amount of any Non-controllable interest in the acquiree; and
×× In a business combination achieved in stages, the acquisitiondate fair value of the acquirer’s previously held equity interest
in the acquiree.
(ii) the net of the acquisition-date amounts of the identifiable assets
acquired and the liabilities assumed
In the case that (ii) exceeds (i), a difference must be registered as a gain.
The values of assets and liabilities acquired as part of a business
combination can be reviewed for a period of 12 months from the
date of acquisition.
The acquisition cost is subsequently adjusted when the purchase price
/ allocation is contingent upon the occurrence of specific events
agreed with the seller / shareholder.
The principal accounting policies applied in the preparation of these
consolidated financial statements are set out below. These policies
have been consistently applied to all the years presented.
a. Basis of pre sentat ion
Consolidated statements were prepared based in accordance with
International Financial Reporting Standards (IFRS) as adopted by the
European Union as of December 31, 2015.
Consolidated statements were prepared based on a going concern
basis and using the records as stated in the companies’ books included
in the consolidation which adopted local general accepted accounting
principles. Accounting adjustments were made in order to comply with
group accounting policies, following the historical cost principle, except
for financial instruments, which are registered according to IAS 39.
b. Consol idation
Group companies
Group companies, often designated as subsidiaries, are entities
(including structured entities) over which Corticeira Amorim has
control. Corticeira Amorim controls when it is exposed to, or holds
the rights over variable generated returns through its involvement with
the entity. It must have also the capacity to influence those variable
returns through the power it has over the entity activity.
Group companies are consolidated line by line, being the position of
third-party interests in the shareholding of those companies stated in
the consolidated financial position in the “Non-controlling interest”
account. Date of first consolidation or de-consolidation is, in general,
the beginning or the end of the quarter when the conditions for that
purpose are fulfilled.
Profit or loss is allocated to the shareholders of the mother company
and to the non-controlling interest in proportion of their correspondent
parts of capital, even in the case that non-controlling interest become
negative.
IFRS 3 is applied to all business combinations past January 1, 2010,
according to Regulamento no. 495/2009, of June 3, as adopted by the
European Commission. When acquiring subsidiaries the purchasing
method will be followed. According to the revised IFRS, the acquisition
cost will be measured by the given fair value assets, by the assumed
liabilities and equity interest issued. Transactions costs will be charged
as incurred and the services received. The exceptions are the costs
related with debt or capital issued. These must be registered according
to IAS 32 and IAS 39. Identifiable purchased assets and assumed liabilities
will be initially measured at fair value. The acquirer shall recognized
goodwill as of the acquisition date measured as the excess of (i) over
(ii) below:
(i) the aggregate of:
×× the consideration transferred measured in accordance with
this IFRS;
Any contingent payments to be transferred by the Group are recognized
at fair value at the acquisition date. Subsequent changes in fair value
that may occur, evaluated as assets or liabilities are recognized in
accordance with IAS 39.
Inter-company transactions, balances and unrealized gains on transactions between group companies are eliminated. Unrealized losses
are also eliminated but considered an impairment indicator of the
asset transferred.
The amounts reported by the Group’s subsidiaries are adjusted where
necessary to conform with the accounting policies of Corticeira Amorim.
Non-controlling interest
Non-controlling Interest are recorded at fair value or in the proportion
of the percentage held in the net asset of the acquire, as long as it
is effectively owned by the entity. The others components of the
non-controlling interest are registered at fair value, except if other
criteria is mandatory.
Transactions with Non-controlling interests are treated as transactions
with Group Equity holders, when no loss of control occurs.
In any acquisition from non-controlling interests, the difference
between the consideration paid and the accounting value of the
share acquired is recognised in equity. Gains or losses on disposals to
non-controlling interests are also recorded in equity.
When the Group ceases to have control or significant influence, any
retained interest in the entity is remeasured to its fair value, with the
change in carrying amount recognised in profit or loss.
Equity companies
Associates are all entities over which the Group has significant influence
but not control, generally accompanying a shareholding between 20%
and 50% of voting rights. Investments in associates are accounted for
using the equity method of accounting and are initially recognised at
cost. The Group’s investment in associates includes goodwill. Future
impairments of goodwill will be adjusted against the carrying amount of
investments. The Group’s share of its associates post-acquisition profits
or losses is recognised in the income statement, in the “Gain/(losses)
in associates” account, and its share of post-acquisition movements
in reserves is recognised in reserves. The carrying amount is also
adjusted by dividends received. When the Group’s share of losses in
an associate equals or exceeds its interest in the associate, the group
does not recognise further losses, unless it has incurred obligation
on behalf of the associate, in this case the liabilities will be recorded
in a “Provisions” account.
The accounting policies adopted by the associates are adjusted to the
accounting policies of the group.
NOTE S TO THE CONSOLiDATED FiNANCiAL STATE mENTS —
107
Exchange rate effect
Euro is the legal currency of Corticeira Amorim, S.G.P.S., S.A., and is
the currency in which two thirds of its business is made and so Euro is
considered to be its functional and presentation currency.
In non-euro subsidiaries, all assets and liabilities denominated in
foreign currency are translated to euros using year-end exchange
rates. Net exchange differences arising from the different rates used
in transactions and the rate used in its settlements is recorded in the
income statement.
Assets and liabilities from non-euro subsidiaries are translated at the
balance sheet date exchange rate, being its costs and gains from the
income statement translated at the average exchange rate for the
period / year.
Exchange differences are registered in an equity account “Translation
differences” which is part of the line “Other reserves”.
Whenever and a non-euro subsidiary is sold or liquidated, accumulated
translation differences recorded in equity is registered as a gain or a
loss in the consolidated income statement by nature.
c. Tangible Fixed Assets
Tangible fixed assets are originally their respective historical cost
(including attributable expenses) or production cost, including,
whenever applicable, interest costs incurred throughout the respective
construction or start-up period, which are capitalised until the asset
is ready for its projected use.
Tangible fixed assets are subsequently measured at acquisition cost,
deducted from cumulative depreciations and impairments.
Depreciation is calculated on the straight-line basis, over the following
years, which represent a reasonable estimate of the useful lives:
Amortisation of the intangible assets is calculated by the straight-line
method, and recorded as the asset qualifies for its required purpose:
Number of years
Industrial Property
Software
10 to 20
3 to 6
The estimated useful life of assets are reviewed and adjusted when
necessary, at the balance sheet date.
e. Inve stment propert y
Investment property includes land and buildings not used in production.
Investment property are initially registered at acquisition cost plus
acquisition or production attributable costs, and when pertinent financial
costs during construction or installation. Subsequently are measured
at acquisition cost less cumulative depreciations and impairment.
Periods and methods of depreciation are as follows in c) note for
tangible fixed asset.
Properties are derecognized when sold. When used in production
are reclassified as tangible fixed asset. When land and buildings are
no mores used for production, they will be reclassified from tangible
fixed asset to investment property.
f. Go odwill
Goodwill arises from acquisition of subsidiaries and represents the excess
of the cost of an acquisition over the fair value of the net identifiable
assets of the acquired at the date of acquisition. If positive, it will be
included as an asset in the “goodwill” account. If negative, it will be
registered as a gain for the period.
In Business combinations after January 1, 2010, Goodwill will be
calculated as referred in b).
Number of years
Buildings
Plant machinery
Motor vehicles
Office equipment
20 to 50
6 to 10
4 to 7
4 to 8
Depreciation is charged since the beginning of the moment in which
the asset is ready to use. The asset’s residual values and useful lives
are reviewed, and adjusted if appropriate, at each reporting date.
Current maintenance on repair expenses are charged to the actual
income statement in which they occurred. Cost of operations that can
extend the useful expected life of an asset, or from which are expected
higher and significative future benefits, are capitalized.
An asset’s carrying amount is written down to its recoverable amount
and charged to the income statement if the asset’s carrying amount
is greater than its estimated recoverable amount.
Gains and losses and disposals are included in the income statement.
d. Intang ible assets
Intangible assets are initially measured at cost. Subsequently they are
measured at cost less accumulated depreciation.
Research expenditures are recognised in the income statement as
incurred.
Development expenditure is recognised as intangible asset when the
technical feasibility being developed can be demonstrated and the
Group has the intention and capacity to complete their development
and start trading or using them and that future economic benefits
will occur.
108
For impairment tests purposes, goodwill is allocated to the cashgenerating unit or group of cash-generating units that are expected
to benefit from the upcoming synergies.
Goodwill will be tested annually for impairment, or whenever an
evidence of such occurs; impairment losses will be charged to the
income statement and, consequently, its carrying amount adjusted.
g. Non-financial assets impairment
Assets with indefinite useful lives are not amortised but are annually
tested for impairment purposes.
For the estimate of impairments, assets are allocated to the lowest level
for which there is separate identifiable cash flows (cash generating units).
Assets under depreciation are tested for impairment purposes whenever
an event or change of circumstances indicates that its value cannot
be recovered. Impairment losses are recognized as the difference
between its carrying amount and its recoverable amount. Recoverable
corresponds to the higher of its fair value less sales expenses and its
value for use. Non-financial assets, except goodwill, that generated
impairment losses are valued at each reporting date regarding reversals
of said losses.
h. Other f inancial assets
This caption is primarily related to investments in equity instruments
available for sale, which have no stock exchange share price and whose
fair value cannot be estimated reliably and are therefore measured
at cost. Dividends, if any, are recognized in the period in which they
occur, when the right to receive is established.
i. Inventor ie s
Inventories are valued at the lower of acquisition cost or production cost
and net realisable value. Acquisition cost includes direct and indirect
expenses incurred in order to have those inventories at its present
condition and place. Production cost includes used raw material costs,
direct labour, other direct costs and other general fixed production
costs (using normal capacity utilisation).
Where the net realisable value is lower than production cost, inventory
impairment is registered. This adjustment will be reversed or reduced
whenever the impairment situation no longer takes place.
Year-end quantities are determined based on the accounting records,
which are confirmed by the physical inventory taking. Raw materials,
consumables and by-products are valued at weighted average cost, and
finished goods and work-in-progress at the average production cost
which includes direct costs and indirect costs incurred in production.
j. Trade and other re ceivable s
Trade and other receivables are registered initially at fair value and
subsequently registered at amortized cost, and adjusted for any
subsequent impairment losses which will be charged to the income
statement.
Medium and long-term receivables, if applicable, will be measured
at amortised cost using the effective interest rate of the debtor for
similar periods.
Trade and other receivables are derecognised when the rights to
receive cash flows from the investments expire or are transferred, as
well as all the risks and rewards of its ownership.
k. Financial assets impairment
At each reporting date, the impairment of financial assets at amortised
cost is evaluated.
Financial asset impairment occurs if after initial register, unfavourable
cash flows from that asset can be reasonably estimated.
Impairment losses are recognized as the difference between its carrying
amounts and expected future cash flows (excluding future losses that
yet have not occurred), discounted at the initial effective interest
rate of the asset. The calculated amount is deducted to the carrying
amount and loss recognised in the earnings statement.
l. Cash and cash equ ivalents
Cash includes cash in hand, deposits held at call in banks, time deposits
and other no-risk short-term investments with original maturities of
three months or less. In the Consolidated Statement of Cash Flow,
this caption includes Bank overdrafts.
m. Suppliers, other borrowing s and creditors
Debts to suppliers and other borrowings and creditors are initially
registered at fair value. Subsequently are measured at amortised cost
using effective interest rate method. They are classified as current
liabilities, except if Corticeira Amorim has full discretion to defer
settlement for at least another 12 months from the reporting date.
Liabilities are derecognised when the underlying obligation is extinguished by payment, cancelled or expire.
n. Intere st bearing loans
This line includes interest bearing loans amounts. Any costs attributable
to the lender, will be deducted to the loan amount and charged, during
its life, using the effective interest rate.
Interests are usually charged to the income statement as they occur.
Interests arising from loans related with capital expenditure for periods
longer than 12 months will be capitalised and charged to the specific
asset under construction. Capitalisation will cease when the project
is ready for use or suspended.
o. Income ta xe s – current and deferred
Income tax includes current income tax and deferred income tax.
Except for companies included in groups of fiscal consolidation,
current income tax is calculated separately for each subsidiary, on
the basis of its net result for the period adjusted according to tax
legislation. Management periodically addresses the effect of different
interpretations of tax law.
Deferred taxes are calculated using the liability method, reflecting the
temporary differences between the carrying amount of consolidated
assets and liabilities and their correspondent value for tax purposes.
Deferred tax assets and liabilities are calculated and annually registered
using actual tax rates or known tax rates to be in vigour at the time of
the expected reversal of the temporary differences.
Technical Cork Stoppers
109
Deferred tax assets are recognized to the extent that it is probable
sufficient future taxable income will be available utilisation. At the end
of each year an analysis of the deferred tax assets is made. Those that
are not likely to be used in the future will be derecognised.
Deferred tax liabilities are recognized for all taxable temporary differences, except those related to i) the initial recognition of goodwill;
or ii) the initial recognition of assets and liabilities that do not result
from a business combination, and that at transaction date does not
affect the accounting or tax result.
Deferred taxes are registered as an expense or a gain of the year,
except if they derive from values that are booked directly in equity.
In this case, deferred tax is also registered in the same line.
p. Employee benef its
Corticeira Amorim Portuguese employees benefit exclusively from the
national welfare plan. Employees from foreign subsidiaries (about 30%
of total Corticeira Amorim) or are covered exclusively by local national
welfare plans or benefit from complementary contribution plans.
As for the defined contribution plans, contributions are recognised
as employee benefit expense when they are due.
Corticeira Amorim recognises a liability and an expense for bonuses
attributable to a large number of directors. These benefits are based on
estimations that take in account the accomplishment of both individual
goals and a pre-established Corticeira Amorim level of profits.
q. Provisions, contingent assets and
liabilitie s
Provisions are recognised when Corticeira Amorim has a present legal
or constructive obligation as a result of past events, when it is more
likely than not an outflow of resources will be required to settle the
obligation and when a reliable estimation is possible.
Provisions are not recognised for future operating losses. Restructuring
provisions are recognised with a formal detail plan and when third
parties affected are informed.
When there is a present obligation, resulting from a past event, but it
is not probable that an out flow of resources will be required, or this
cannot be estimated reliably, the obligation is treated as a contingent
liability. This will be disclosed in the financial statements, unless the
probability of a cash outflow is remote.
Contingent assets are not recognized in the financial statements but
disclosed when it is probable the existence of an economic future
inflow of resources.
r. Revenue re co gnition
Revenue comprises the value of the consideration received or receivable
for the sale of goods and finished products. Revue is shown, net of
value-added tax, returns, rebates, and discounts, including cash
discounts. Revenue is also adjusted by any prior period’s sales corrections.
Services rendered are immaterial and, generally, are refunds of costs
related with finish product sales.
Sales revenue is recognised when the significant risk and rewards of
ownership of the goods are transferred to the buyer and its amount
can be reliably measured. Revenue receivable after one year will be
discounted to its fair value.
s. Government grants
Grants received are related generally with fixed assets expenditure.
No-repayable grants are present in the balance sheet as deferred
income, and recognised as income on a systematic basis over the
useful life of the related asset. Repayable interest bearing grants are
presented as interests bearing debt; if no-interest bearing, they are
110
presented as “Other borrowings”. Reimbursable grants with “out
of market” interest rates are measured at fair value when they are
initially recognised. Difference between nominal and fair value at
initial recognition is treated as an income to be recognised. This will
be presented in other gains during the useful life span of the said
asset. Subsequently, these grants are measured at amortised cost.
t . Leasing
When a contract indicates that the significant risks and rewards of the
ownership of the asset are transferred to Corticeira Amorim, leasing
contracts will be considered as financial leases.
All other leasing contracts are treated as operating leases. Payments
made under operating leases are charged to the income statement.
Whenever Corticeira Amorim qualifies as lessee of finance leases,
assets under lease are recognized as Tangible Fixed Assets and are
depreciated over the shorter of the term of the contract and the
useful life of the assets.
u. Derivative financial instruments
Corticeira Amorim uses derivatives financial instruments as forward and
spot exchange rate contracts, options and swaps; these are intended
to hedge its business financial risks and are not used for speculative
purposes. Corticeira Amorim accounts for these instruments as hedge
accounting, following all its standards. Dealing is carried out by a central
treasury department (dealing room) on behalf of the subsidiaries,
under policies approved by the Board of Directors. Derivatives are
recorded at their fair value. The method of recognising is as follows:
a.Fair value hedge
Changes in the fair value of derivatives that qualify as fair
value hedges and that are expected to be highly effective,
are recorded in the income statement, together with any
changes in the fair value of the hedged asset or liability that
are attributable to the hedged risk.
b.C ash flow hedge
Changes in the fair value of derivatives that qualify as cash
flow edges and that are expected to be highly effective, are
recognised in equity, being transferred to income statement
in the same period as the respective hedged item affects
results; the gain or loss relating to the ineffective portion is
recognised immediately in the income statement.
c.Net investment hedge
For the moment, Corticeira Amorim is not considering any
foreign exchange hedge over its net investments in foreign
units (subsidiaries).
Corticeira Amorim has fully identified the nature of its activities’
risk exposure and documents entirely and formally each hedge;
uses its information system to guarantee that each edge is
supported by a description of: risk policy, purpose and strategy,
classification, description of risk, identity of the instrument and
of the risk item, description of initial measurement and future
efficiency, identification of the possible derivative portion
which will be excluded from the efficiency test.
When a hedging instrument expires or is sold, or when a hedge
no longer meets the criteria for hedge accounting, or the
forecasted transaction no longer remains highly provable or
simply is abandoned, or the decision to consider the transaction
as a hedge, the company will de-recognised the instrument.
v. Equit y
Ordinary shares are included in equity.
When Corticeira Amorim acquires own shares, acquisition value is
recognised deducting from equity in the line treasury stock.
III
FINANCIAL RISK
MANAGEMENT
Corticeira Amorim activities expose it to a variety of financial risks: market risks (including
currency risk and interest rate risk), credit risk, liquidity risk and capital risk.
M arket risk
a. Exchange rate risk
Corticeira Amorim operates in various international markets, being, consequently, exposed
to exchange rates variations in the local currencies in which conducts its business. Around one
third of its total sales are denominated in currencies other than its reporting currency (euro),
of which around two thirds is USD denominated. The remaining sales are concentrated in
South African rand, Chilean peso, British pound and Australian dollar. About 90% of the goods
and services acquired are euro based. Most of the remaining value is denominated in USD.
Exchange rate risk derives not only from the effects of the exchange rates variations in non-euro
assets and liabilities euro counter value, but also from the effects in the book orders (future
transactions) and from net investments in operating units located in non-euro areas.
Exchange rate risk management policy established by Corticeira Amorim
Board points out to a total hedging of the assets deriving from sales in the
most important currencies and from USD acquisitions. As for book orders up to
90 days, each Business Unit responsible will decide according to exchange rate evolution.
Book orders, considered relevant, due after 90 days, will be presented by the Business Unit
responsible to the Board.
As of December 31, 2015, exchange rates different from the actual as of that date, would have
no material effect in financial assets or liabilities values, due to the said hedging policy. As
for book orders any effect would be registered in Equity. As for non-euro net investments in
subsidiaries/associate, any exchange rate effect would be registered in Equity, because Corticeira
Amorim does not hedge this type of assets. As these investments are not considered relevant,
the register of the effects of exchange rates variations was 1,145 K€ as of December 31, 2015
(2014: 225 K€).
b. Interest rate risk
As of December 31, 2014, all interest bearing debt was linked to variable interest rate. As of
December 31, 2015, from the total interest bearing debt, 25 M€ were linked to fixed interest
rate for a 10 year period.
Most of the risk derives from the noncurrent-term portion of that debt at variable rate (16.2 M€
as of 31/12/2015 and 26.2 M€ as of 31/12/2014). During 2010 and 2013 Corticeira Amorim, SGPS,
SA signed interest rate swaps regarding the economic hedging of the interest rate risk. In its
books, these were registered as an available-for-sale derivative. The derivative contracted in
2010 expired in 2015. These loans accounted, respectively, at the end of those periods about
18% and 28% of total interest bearing debt.
As of December 31, 2015, for each 0.1% variation in euro based debt, a total effect of -91 K€ in
Corticeira Amorim profits would be registered.
Credit risk
Credit risk is due, mainly, to receivables from customers related to trade sales. Credit risk is
monitored by the operating companies Financial Departments, taking in consideration its
history of trade relations, financial situation as well as other types of information that Corticeira
Amorim business network has available related with each trading partner. Credit limits are
analysed and revised, if necessary, on a regular basis. Due to the high number of customers,
spread through all continents, the most important of them weighting less than 3% of total
sales, credit risk is naturally diminished.
Normally no guarantees are due from customers. Corticeira Amorim does not make use of
credit insurance.
111
Credit risk derives also from cash and cash equivalents balances and from financial derivative
instruments. Corticeira Amorim previously analysis the ratings of the financial institutions so
that it can minimize the failure of the counterparts.
The maximum credit risk is the one that results from the failure to receive all financial assets
(December 2015: 170 million euros and December 2014: 156 million euros).
Liquidity risk
Corticeira Amorim financial department regularly analyses future cash flows so that it can
deliver enough liquidity for the group to provide operating needs, and also to comply with
credit lines payments. Excess of cash is invested in interest bearing short-term deposits. This
police offer the necessary flexibility to conduct its business.
Financial liabilities estimated non-discounted cash flows maturities are as follows:
Trade payables
Total as of December 31, 2014
Trade payables
Up to
1 year
1 to
2 years
2 to
4 years
More than
4 years
67,369
37,703
115,303
220,375
50,146
44,259
121,184
215,589
20,957
4,362
1,219
4,938
4,049
2,234
25,319
1,916
3,538
6,157
5,916
6,287
6,283
33,379
191
5,454
12,203
33,570
Total
93,594
49,237
115,303
258,134
91,357
54,275
121,184
266,816
(thousand euros)
Liquidity risk hedging is achieved by the existence of non-used credit line facilities and,
eventually bank deposits.
Based in estimated cash flows, 2016 liquidity reserve, composed mainly by non-used credit
lines, will be as follows:
2016
Opening balance
Operating cash in and cash out
Capex
Interest and dividends
Income tax
Bank debt payments
139
95
-26
-23
-17
-10
Closing balance
158
Note: includes dividends to be approved in the March 30, 2016 shareholders meeting
C apital risk
Corticeira Amorim key objective is to assure business continuity, delivering a proper return
to its shareholders and the correspondent benefits to its remaining stakeholders. A careful
management of the capital employed in the business, using the proper combination of capital
in order to reduce its costs, obtains the fulfilment of this objective. In order to achieve the
proper combination of capital employed, the Board can obtain from the General Shareholders
Meeting the approval of the necessary measures, namely adjusting the dividend pay-out
ratio, the treasury stock, raising capital through new shares issue, sale of assets or other type
of measures.
The key indicator for the said combination is the Equity / Assets ratio. Corticeira Amorim
considers that a 40% ratio is a clear sign of a perfect combination, and should not deviate
significantly from the range 40%-50%, depending on actual economic conditions and of the
cork sector in particular, is the objective to be accomplished. The said ratio register was:
112
(million euros)
2015
2014
2013
Equity
354,133
315,569
301,737
Assets
667,219
617,446
627,307
53.1%
51.1%
48.1%
Ratio
(thousand euros)
Financial assets and liabilities fair value
As of December 31, 2015 and December 2014, financial instruments measured at fair value in
the financial statements of Corticeira Amorim were composed solely of derivative financial
instruments. Derivatives used by Corticeira Amorim have no public quotation because they
are not traded in an open market (over the counter derivatives).
According to the accounting standards, a fair value hierarchy is established that classifies three
levels of data to be used in measurement techniques at fair value of financial assets and liabilities:
Level 1 data – public quotation (non-adjusted) in liquid markets for comparable
assets or liabilities;
Level 2 data – different data of public quotation observable for the asset or the
liability, directly or indirectly;
Level 3 data – non observable data for the assets or the liability.
As of December 31, 2015, derivative financial instruments recognised as assets in the consolidated
statement of financial position are not material, reaching 1,051 thousand euros (2014: 81 K€)
and 449 thousand euros as liabilities (2014: 2,589 K€), as stated in notes XVI and XXII.
As stated in notes III b) and XIX, Corticeira Amorim entered two swaps to hedge interest rate
risk. These swaps are recorded as trading derivatives and are evaluated by external financial
entities. For one of these swaps, matured in 2015, a proprietary model which utilises, on top
of other inputs, a proprietary index (level 3). For the other, the evaluation uses observable
inputs indirectly in the market (level 2).
Corticeira Amorim uses forward outrights and options to hedge exchange rate risk, as stated
in note XXX. Evaluating exchange rate hedge instruments requires the utilisation of observable
inputs (level 2). Fair value is calculated using a proprietary model of Corticeira Amorim,
developed by Reuters, using discounted cash flows method for forwards outrights. As for
options, it is used the Black & Scholes model.
Summary of the financial instruments derivatives fair value:
Nature
Hierarchy
Type
Cash flow hedge
Fair value hedge
Trading derivatives
Level 2 Total
1,710
81
1,710
81
1,051
1,710
81
Cash flow hedge
24,220
-374
10,483
-174
Fair value hedge
20,745
-139
28,984
-2,208
Trading derivatives
Level 2 Total
Trading derivatives
Total Liabilities
31/12/2014
Notional
Fair Value
29,157
Total Assets
Level 3 Total
31/12/2015
Notional
Fair Value
2,961
123
8,821
529
17,374
398
29,157
1,051
29,095
64
20,000
-124
74,061
-449
59,467
-2,505
0
0
30,000
-83
0
0
30,000
-83
74,061
-449
89,467
-2,589
(thousand euros)
113
You m ake the park , outdoor furniture , a partnersh ip with Fabrica
114
Iv
v
CRITICAL
ACCOUNTING
ESTIMATES AND
JUDGEMENTS
CONSOLIDATED
ACCOUNTS
PREPARATION
PROCESS
When evaluating equity and net income, Corticeira Amorim makes
estimates and assumptions concerning events only effective in the
future. In most cases, estimates were confirmed by future events. In
such cases where it doesn’t, variations will be registered when they’ll
be materialized.
The useful lives used represent best estimate for the expected period
of use of property. They are periodically reviewed and adjusted if
necessary, as described in Note II. c.
Still to be noted 8,359 K€ registered in deferred tax assets (2014: 6,708
K€). These values will be recovered if the business plans of the companies
that recorded those assets are materialized in the future (Note XII).
Provisions for tax contingencies and other processes are based on the
best estimate of management regarding losses that may exist in the
future that are associated with these processes (Note XXX).
The description of the main elements of the internal control system
and risk management of the group, in relation to the process of the
consolidated accounts [art. C-508/5 / f) and 8 CSC], is as follows:
The financial information preparation process is dependent on the
actors in the registration process of operations and support systems.
In the group there is an Internal Control Procedures Manual and
Accounting Manual, approved by the Board which must be adopted by
all companies of the Corticeira Amorim Group. These manuals contain
a set of rules and policies to ensure that in the financial information
preparation process homogeneous principles are followed, and to
ensure the quality and reliability of financial information.
The implementation of accounting policies and internal control
procedures relating to the preparation of financial information is
subject to the evaluation by the internal and external audit.
Every quarter, the consolidated financial information by business unit
is assessed, validated and approved by the management of each of
the group’s business units.
Before its release, the consolidated financial information of Corticeira
Amorim is approved by the Board of Directors and presented to the
Supervisory Board.
Building faç ade with expanded insulat ion corkboard
115
vI
COMPANIES INCLUDED
IN THE CONSOLIDATED
FINANCIAL STATEMENTS
Company
Raw Materials
Amorim Florestal España, SL
Amorim Florestal Mediterrâneo, SL
Amorim Tunisie, S.A.R.L .
Augusta Cork, S.L .
Comatral - C. de Maroc. de Transf. du Liège, S.A.
SIBL - Société Industrielle Bois Liége
Société Nouvelle du Liège, S.A. (SNL)
Société Tunisienne d'Industrie Bouchonnière
Vatrya - Serviços de Consultadoria, Lda
Cork Stoppers
Amorim & Irmãos, SGPS, S.A.
ACIC USA, LLC
Agglotap, SA
All Closures In, S.A..
Amorim Argentina, S.A.
Amorim Australasia Pty Ltd
Amorim Bartop, S.A.
Amorim Cork América, Inc.
Amorim Cork Beijing Ltd
Amorim Cork Bulgaria EOOD
Amorim Cork Deutschland GmbH & Co KG
Amorim Cork España, S.L .
Amorim Cork Itália, SPA
Amorim Cork South Africa (Pty) Ltd
Amorim France, S.A.S.
Bouchons Prioux
Carl Ed. Meyer Korken
Chapuis, S.L .
Corchera Gomez Barris
Corchos de Argentina, S.A.
Equipar, Participações Integradas, Lda.
FP Cork, Inc.
Hungarocork, Amorim, RT
Indústria Corchera, S.A.
Korken Schiesser Ges.M.B.H.
Olimpiadas Barcelona 92, S.L .
Portocork América, Inc.
Portocork France, S.A.S.
Portocork Internacional, S.A.
Portocork Itália, s.r.l
Sagrera et Cie
116
Head Office
Country
2015
2014
Vale de Cortiças - Abrantes
Ponte de Sôr
San Vicente Alcántara
Cádiz
Tabarka
Skhirat
Jijel
Tabarka
(b)
Tabarka
Funchal - Madeira
Portugal
Portugal
Spain
Spain
Tunisia
Espanha
Morocco
Algeria
Tunisia
Tunisia
Portugal
100%
100%
100%
100%
100%
100%
100%
51%
100%
45%
100%
100%
100%
100%
100%
100%
100%
100%
51%
100%
45%
100%
Santa Maria Lamas
California
Girona
Paços de Brandão
Santa Maria Lamas
Buenos Aires
Adelaide
Mozelos
California
Beijing
Plovdiv
Mainzer
Conegliano
Cape Town
Champfleury
Epernay
Delmenhorst
Girona
Santiago
Mendoza
Coruche
California
Girona
Budapeste
Santiago
Viena
Girona
California
Bordéus
Santa Maria Lamas
Milão
Reims
Portugal
U. S. America
Spain
Portugal
Portugal
Argentina
Australia
Portugal
U. S. America
China
Bulgaria
Germany
Spain
Italy
South Africa
France
France
Germany
Spain
Chile
Argentina
Portugal
U. S. America
Spain
Hungary
Chile
Austria
Spain
U. S. America
France
Portugal
Italy
France
100%
100%
91%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
91%
–
100%
50%
50%
100%
100%
92%
100%
50%
69%
100%
100%
100%
100%
100%
91%
100%
–
91%
–
100%
100%
100%
–
100%
100%
100%
100%
100%
100%
100%
100%
91%
100%
100%
50%
50%
100%
100%
92%
100%
50%
69%
100%
100%
100%
100%
100%
91%
(f )
(f )
(d)
(b)
(c)
Company
S.A. Oller et Cie
S.C.I. Friedland
S.C.I. Prioux
Société Nouvelle des Bouchons Trescases
Trefinos Australia
Trefinos Italia, s.r.l
Trefinos USA, LLC
Trefinos, S.L
Victor y Amorim, Sl
Wine Packaging & Logistic, S.A.
Head Office
Reims
Céret
Epernay
Perpignan
Adelaide
Treviso
Fairfield, CA
Girona
Navarrete - La Rioja
Santiago
Country 2015 2014
France 92% 92%
France 100% 100%
France 91% 91%
France 50% 50%
Australia 91% 91%
Italy 91% 91%
U. S. America 91% 91%
Spain 91% 91%
Spain 50% 50%
Chile 50% 50%
S. Paio de Oleiros
Tholen
Delmenhorst
S. Paio de Oleiros
Zug
Vienna
Hanover - Maryland
Hanover - Maryland
Tokyo
Barcelona
Fürth
Kraków
Hadsund
Dalton - Georgia
Fürth
Portugal
Netherlands
Germany
Portugal
Switzerland
Austria
U. S. America
U. S. America
Japan
Spain
Germany
Poland
Denmark
U. S. America
Germany
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
50%
51%
25%
–
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
50%
51%
25%
100%
Mozelos
Horsham West Sussex
Mozelos
Trevor Wisconsin
Delmenhorst
Corroios
Istambul
Xangai
Shaanxi
Hong Kong
Lavardac
Mozelos
Funchal - Madeira
Mozelos
Funchal – Madeira
Portugal
United Kingdom
Portugal
U. S. America
Germany
Portugal
Turkey
China
China
China
France
Portugal
Portugal
Portugal
Portugal
100%
100%
100%
100%
100%
100%
25%
30%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
25%
30%
100%
100%
100%
100%
100%
100%
100%
Vendas Novas
Portugal
80%
80%
(e) (b)
Mozelos
Skhirat
Mozelos
Mozelos
Mozelos
Mozelos
Portugal
Morocco
Portugal
Portugal
Portugal
Portugal
100%
100%
100%
100%
100%
25%
100%
100%
100%
100%
100%
–
(e) (b)
Mozelos
Portugal
24%
–
Montijo
Portugal 100% 100%
(b)
(c)
(b)
Floor & Wall Coverings
Amorim Benelux, BV
Amorim Deutschland, GmbH - AR
Amorim Flooring, SA
Amorim Flooring (Switzerland) AG
Amorim Flooring Austria GesmbH
Amorim Flooring Investments, Inc.
Amorim Flooring North America Inc.
Amorim Japan Corporation
Amorim Revestimientos, S.A.
Cortex Korkvertriebs GmbH
Dom KorKowy, Sp. Zo. O.
Timberman Denmark A/S
US Floors, Inc.
Zodiac Kork- und Holzprodukte GmbH
(a)
(g)
(c)
(b)
(d)
Composites Cork
Amorim (UK) Ltd.
Amorim Compcork, Lda
Amorim Cork Composites Inc.
Amorim Deutschland, GmbH - ACC
Amorim Industrial Solutions - Imobiliária, S.A.
AmorLink
Amosealtex Cork Co., Ltd
Chinamate (Shaanxi) Natural Products Co. Ltd
Chinamate Development Co. Ltd
Corticeira Amorim - France SAS
Florconsult – Consultoria e Gestão, Lda
Postya - Serviços de Consultadoria, Lda.
Florconsult – Consultoria e Gestão, Lda.
Postya – Serviços de Consultadoria, Lda.
(a)
(b)
(b)
Insulation Cork
Holding
Corticeira Amorim, SGPS, S.A.
Ginpar, S.A. (Générale d' Invest. et Participation)
Amorim Cork Ventures, Lda
Corkyn Composites, Lda
Ecochic portuguesas – footwear
and fashion products, Lda
Soc. Portuguesa de Aglomerados de Cortiça, Lda
(a) One single company: Amorim Deutschland, GmbH & Co. KG
(b) Equity method consolidation
(c) Corticeira Amorim controls the operations of the company – line-by-line consolidation method
(d) Zodiak merged with Cortex during 1H2015 and CEM Korken merged with A. C. Deutschland during 2H2015
(e) Associate set-up in 2015
(f) Subsidiary set-up in 2015
(g) ex-Amorim Top Series (set-up by BU Cork Stoppers in 2014)
117
vIi
EXCHANGE
RATES USED IN
CONSOLIDATION
Year end
2015
Average
2015
Year end
2014
Average
2014
ARS
AUD
BGN
BRL
CAD
CHF
CLP
CNY
DKK
DZD
EUR
GBP
HKD
HUF
JPY
MAD
PLN
TND
TRL
USD
14.04839
1.48970
1.95570
4.31170
1.51160
1.08350
768.730
7.06080
7.46260
116.071
1
0.73395
8.4166
315.980
131.070
10.7376
4.26390
2.21090
3.17650
1.08870
10.28032
1.47766
1.95573
3.70044
1.41856
1.06786
725.899
6.97333
7.45870
111.1085
1
0.72584
8.60559
309.996
134.314
10.8028
4.18412
2.17523
3.02546
1.10951
10.77468
1.47188
1.95471
3.12113
1.46614
1.21462
756.917
8.18575
7.45482
106.6354
1
0.80612
10.29987
308.706
140.306
11.1387
4.18426
2.25012
2.90650
1.32850
10.12833
1.48290
1.95580
3.22070
1.40630
1.20240
733.560
7.53580
7.44530
106.119
1
0.77890
9.3798
315.540
145.230
10.93
4.27320
2.25770
2.83200
1.21410
ZAR
16.9530
14.1723
14.4037
14.0353
Exchange rates
Argentine Peso
Australian Dollar
Lev
Brazilian Real
Canadian Dollar
Swiss Franc
Chilean Peso
Yuan Renminbi
Danish Krone
Algerian Dinar
Euro
Pound Sterling
Hong Kong Dollar
Forint
Yen
Moroccan Dirham
Zloty
Tunisian Dinar
Turkish Lira
US Dollar
Rand
Top Series cork stoppers
118
vIIi
SEGMENT
REPORT
Corticeira Amorim is organised in the following Business Units (BU): Raw Materials, Cork
Stoppers, Floor and Wall Coverings, Composite Cork and Insulation Cork.
For purposes of this Report, the Business approach was selected as the primary segment. This is
consistent with the formal organization and evaluation of business. Business Units correspond
to the operating segments of the company and the segment report is presented the same way
they are analysed for management purposes by the board of Corticeira Amorim.
The following table shows the main indicators of the said units, and, whenever possible, the
reconciliation with the consolidated indicators (values in thousand EUR):
Raw Materials
Cork Stoppers
Floor & Wall
Coverings
Composite Cork
Insulation Cork
Holding
Ajustm.
Consolidated
7,344
388,493
107,440
92,944
8,536
43
0
604,800
Other BU Sales
128,093
4,332
2,403
7,036
1,504
2,172
-145,540
-
Total Sales
135,437
392,825
109,843
99,980
10,040
2,215
-145,540
604,800
16,988
62,753
8,173
14,585
1,241
-2,771
-249
100,720
151,055
328,086
92,934
75,122
11,850
2,246
5,927
667,219
42,909
109,411
31,317
28,542
2,367
14,650
83,890
313,086
6,914
16,958
3,003
3,593
289
638–
31,394
-2,552
-12,252
-4,800
-4,802
-604
-42
–
-25,051
Non-cash cost
38
-5,257
-715
-181
-476
135
0
-6,456
Gains/Losses in associated
companies
-8
1,331
1,782
-12
0
-3
–
3,091
Raw Materials
Cork Stoppers
Floor & Wall
Coverings
Composite Cork
Insulation Cork
Holding
Ajustm.
Consolidated
5,253
353,306
113,345
79,431
8,138
866
0
560,340
Other BU Sales
126,120
3,996
3,018
4,850
1,876
5,992
-145,853
-
Total Sales
131,373
357,302
116,363
84,282
10,014
6,859
-145,853
560,340
17,492
46,830
15,520
7,748
1,653
-1,806
-714
86,722
136,146
300,237
87,860
79,754
12,866
475
106
617,446
38,095
102,214
28,630
25,898
2,353
14,703
89,983
301,877
2,816
12,917
1,409
3,334
562
182
–
21,220
-2,878
-11,105
-4,659
-2,976
-613
-105
–
-22,336
35
62
-1,867
-1,244
18
504
0
-2,493
0
810
490
-19
0
0
–
1,280
2015
Trade Sales
EBITDA (current)
Assets
Liabilities
Capex
Year Depreciation
2014
Trade Sales
EBITDA (current)
Assets
Liabilities
Capex
Year Depreciation
Non-cash cost
Gains/Losses in associated
companies
Notes:
Adjustments = eliminations inter-BU and amounts not allocated to BU.
EBITDA = Profit before interests, depreciation, equity method, non-controlling interests and income tax.
Provisions and asset impairments were considered the only relevant non-cash material cost
Segments assets do not include DTA (deferred tax asset) and non-trade group balances
Segments liabilities do not include DTL (deferred tax liabilities), bank loans and non-trade group balances.
(thousand euros)
119
The decision to report EBITDA figures allows a better comparison of
the different BU performances, disregarding the different financial
situations of each BU. This is also coherent with the existing Corporate
Departments, as the Financial Department is responsible for the bank
negotiations, being the tax function the responsibility of the Holding
Company.
Cork Stoppers BU main product is the different kinds of existing cork
stoppers. The main markets are the bottling countries, from the
traditional ones like France, Italy, Germany, Spain and Portugal, to the
new markets like USA, Australia, Chile, South Africa and Argentina.
Raw Materials BU is, by far, the most integrated in the production cycle
of Corticeira Amorim, with 95% of its sales to others BU, specially to
Cork Stoppers BU. Main products are bark and discs.
Capex was concentrated in Portugal. Assets in foreign subsidiaries
totalize 265 million euros, and are mostly composed by inventories (99
million), customers (84 million) and tangible fixed assets (50 million).
In non-current assets, special note to 141 M€ (2014: 135 M€) of tangible
fixed assets located in Portugal (foreign countries: 50 M€ vs 48 M€
in 2014), 4.8 M€ (2014: 5.0 M€) of property investment (foreign
countries: 0.2 M€ vs 0.2 in 2014), 1.3 M€ (2014: 0.5 M€) of intangible assets (foreign countries: 1.1 M€ vs 0.6 M€ in 2014) and 3.9 M€
(2014: 3.2 M€) of other financial assets (foreign countries: 0.3 M€ vs
0.4 M€ in 2014).
Sales by markets:
Markets
The remaining BU produce and sell a vast number of cork products
made from cork stoppers waste. Main products are cork floor tiles,
cork rubber for the automotive industry and antivibratic systems,
expanded agglomerates for insulation and acoustic purposes, technical
agglomerates for civil construction and shoe industry, as well as
granulates for agglomerated, technical and champagne cork stoppers.
Major markets for flooring and insulation products are in Europe
and for composites products the USA. Major production sites are
in Portugal, where most of the invested capital is located. Products
are distributed in practically all major markets through a fully owned
network of sales companies. About 70% of total consolidated sales
are achieved through these companies.
2015
European Union
358,909
From which: Portugal
29,977
Other European countries 24,176
United States
131,206
Other American countries 45,940
Australasia
34,822
Africa
9,747
Others
604,800
2014
59.3%
5.0%
4.0%
21.7%
7.6%
5.8%
1.6%
341,459
24,834
27,310
107,967
39,104
35,749
8,750
60.9%
4.4%
4.9%
19.3%
7.0%
6.4%
1.6%
100% 560,340 100%
(thousand euros)
Wicanders CorkComfort
120
IX
TANGIBLE,
INTANGIBLE
AND PROPERTY
INVESTMENT ASSETS
Land and
buildings
Machinery
Other
Total tangible
assets
Intangible
assets
Investment
property
Gross value
Depreciation and impairments
Opening balance ( jan 1, 2014)
Increase
Period deprec. and impairments
Sales and other decreases
Transfers and reclassifications
Translation differences
Gross value
225,357
-140,187
85,170
4,259
-5,841
-22
2,329
789
229,817
-143,133
326,674
-248,092
78,582
12,949
-15,319
190
11,466
147
348,850
-260,835
45,828
-24,918
20,910
3,601
-1,714
-235
-14,452
84
37,020
-28,826
597,859
-413,197
184,662
20,809
-22,874
-67
-657
1,020
615,687
-432,794
4,136
-3,444
692
411
-172
6
153
4,670
-3,579
15,489
-10,240
5,250
0
-480
-2
463
-40
15,432
-10,242
Closing balance (dec 31, 2014)
86,684
88,015
8,194
182,893
1,091
5,190
Gross value
Opening balance ( jan 1, 2015)
Increase
Period deprec. and impairments
Sales and other decreases
Transfers and reclassifications
Translation differences
Gross value
229,817
-143,133
86,684
8,289
-6,070
-3
108
709
239,478
-149,761
348,850
-260,835
88,015
15,718
-16,410
-387
1,223
46
362,075
-273,869
37,020
-28,826
8,194
5,804
-1,720
-173
283
42
41,846
-29,416
615,687
-432,794
182,893
29,811
-24,200
-563
1,614
797
643,399
-453,046
4,670
-3,579
1,091
1,583
-269
0
81
4
6,332
-3,843
15,432
-10,242
5,190
0
-476
0
379
-85
15,486
-10,478
Closing balance (Dec 31, 2015)
89,717
88,205
12,430
190,352
2,489
5,008
(thousand euros)
The amount of 5,008 K€, referred as Property Investment (2014: 5,190
K€), is due, mainly, to land and buildings that are not used in production.
During the first half of 2014, following an evaluation made by an
independent entity, it was booked a 1,124 K€ impairment in land and
building in Corroios. As it is planned the discontinuing of the operations
at this site during the second half of 2014, (concluded in the end of 2015),
the property value is no longer recoverable through use. As a result,
an impairment was registered. The report was issued by Cushman &
Wakefield, which concluded that the market value was superior to the
book value. The evaluation was based on the value that would result
from the development of an allotment project for logistics, trade and
services. Comparative market for construction and development costs
were used. The gross yield used for rental purposes was 10%, with the
discount rate of financial flows being 11%. This figure was presented
in the Consolidated Statement of Income as non-recurring expenses.
The increase in depreciation / impairment charges in 2015 is influenced
by an impairment loss of 1,392 K€ recognized in fixed assets of the
group in China, coupled with the decision of the management to
change the Composite BU strategy for this market.
Expenses related with tangible fixed assets had no impact during 2015
and 2014. No interest was capitalised during 2015.
121
x
goodwill
As stated in point II f), goodwill impairment tests are made each year.
Exceptionally were performed in the first half of 2015 impairment tests,
which led to the registration of 2,911 K€ impairments.
Value in use approach was part of the goodwill impairment tests
calculations.
Cash flows were estimated, based on the budget and plans approved
by management. The growth assumptions contemplated the expected
growth in the wine, champagne and sparkling wine markets, as well as
the evolution of the market share of Corticeira Amorim in this business.
In the first half of 2015, the profitability of the subsidiary Industria
Corchera changed significantly due to a drop in sales and an increase
of structural costs. These changes impacted the cash flows expected
for that subsidiary, and as a result, the test performed led to the need
of a goodwill write-off. In that test, growth rates were used from 1%
to 2% for the period 2016-2018 and 1.5% for the following years. The
discount rate used was 8%. Compared to the test performed in 2014,
a drop was observed of approximately 30% in the estimated cash flow
for the implicit period and 40% in relation to perpetuity.
2014
Oller et cie
Industria Corchera
Amorim France
Amorim Cork Italia
Korken Schiesser
Amorim Deutschland
Goodwill
2015
Oller et cie
Industria Corchera
Amorim France
Amorim Cork Italia
Korken Schiesser
Goodwill
Volumes expected for the underlying goodwill of the subsidiary SA Oller
et Cie are not being met, due to the substitution effect on customers
by other group products. The test carried out in this period considered
a growth rate of 1% and an 8% discount rate.
From tests performed in 2014 derived the write-off of the goodwill
associated with Amorim Deutschland. Market conditions resulting
from the failure of the biggest flooring customer in Germany, led to a
substantial change in the retail market of this country. This noticeably
reduced the prospects of profitability of that subsidiary. As a result,
the test led to the need of the write-off of that goodwill. In that test,
sales growth rate of 1% for the three year period 2015 to 2017 and 0.5%
for the following years was used. The discount rate used was 10%. In
view of the test conducted in 2013, there was a break for about half
the estimated cash flow for the implicit period and in perpetuity.
In the remaining tests conducted in 2014, the discount rates ranged
between 8.2% and 10%, varying growth rates between 0.5% and 1%
for perpetuity.
Openning
Increases
750
1,314
0
250
274
164
2,503
5,255
–
–
159
–
–
–
–
159
Decreases Reclassification
Openning
Increases
750
1,314
159
250
274
164
–
–
–
–
–
–
750
1,314
159
250
274
164
–
–
–
–
–
–
2,911
0
2,911
0
–
–
–
–
–
–
2,503
2,503
Closing
–
–
–
–
–
–
–
0
750
1,314
159
250
274
164
0
2,911
Decreases Reclassification
Closing
0
0
0
0
0
0
0
(thousand euros)
122
xI
EQUITY COMPANIES
AND OTHER
FINANCIAL ASSETS
Equity Companies:
Initial Balance
In / Out
Results
Dividends
Exchange Differences
Other
End Balance
2015
2014
10,841
5
3,091
-250
-414
32
13,304
8,129
1,533
1,280
-250
167
-19
10,841
(thousand euros)
During 2014, Industria Corchera, SA participated in a capital increase in Wine Packaging &
Logistic, S.A., corresponding to 1,495 of the total 1,533 in “In / Out”. The remainder corresponds
to the set-up of two associates in Turkey and China.
In 2015, the value in “Exchange Difference” refers to the associates Corchos Argentina and US
Floors (in 2014 mainly US Floors).
Cork Benches, by Naoto Fukasawa
2015
2014
Total
Contrib. to
net income
Financial
stake
Goodwill
Total
Contrib. to
net income
0
1,715
0
0
0
0
3,876
6,152
111
1,688
1,447
30
1,782
589
-8
75
667
-14
1,588
4,098
153
1,694
1,330
263
0
1,715
0
0
0
0
1,588
5,813
153
1,694
1,330
263
490
421
0
-9
398
-20
1,715
13,304
3,091
9,126
1,715
10,841
1,280
Financial
stake
Goodwill
US Floors
Trescases
Soc. Tunisienne Bouchons
Wine Packaging & Logistic
Corchos Argentina
Other
3,876
4,437
111
1,688
1,447
30
End Balance
11,589
(thousand euros)
123
Most important associate companies are Société Nouvelle des Bouchons Trescases, US Floors
inc, Corchos de Argentina and Wine Packaging & Logistic, of which a summary of its financial
situation are presented:
2015
Current assets
Non-current assets
Assets
Equity
Sales
Operating Profit
Net Income
2014
Current assets
Non-current assets
Assets
Equity
Sales
Operating Profit
Net Income
Trescases
US Floors
Corchos Argentina
K€
K USD
K ARS
Wine Packaging
K CLP
14,977
1,075
16,052
8,874
29,231
1,744
1,178
99,827
3,269
103,096
16,876
203,798
19,522
7,907
90,153
4,197
94,350
40,660
139,360
22,873
13,717
1,702,788
5,771,769
7,474,557
3,931,408
–
-116,387
-35,299
14,443
1,253
15,696
8,196
27,024
1,232
62,810
5,717
68,527
8,969
111,535
6,237
49,472
4,489
53,961
26,943
112,061
20,477
2,888,625
1,097,207
3,985,832
3,966,707
–
-44,053
843
2,602
8,580
18,261
Other Financial Assets:
In Other Financial Assets the most important values refers, mostly to equity instruments at cost.
StudioIlse exhibition at the Stockhol m Furniture Fair 2015
124
xII
INCOME
TAX
The differences between the tax due for the current period and prior
periods and the tax already paid or to be paid of said periods is registered
as “deferred tax” in the consolidated income statement, according to
note II j), and amounts to 1,927 K€ (2014: 760 K€).
On the consolidated statement of financial position this effect amounts
to 8,359 K€ (31/12/2014: 6,708 K€) as Deferred tax asset, and to 6,743
K€ (31/12/2014: 6,970 K€) as Deferred tax liability.
Deferred tax related with items directly registered in equity was 76 K€
(credit balance) and relates to hedge accounting. No other deferred
tax values related with other equity movements were booked.
It is conviction of the Board that, according to its business plan, the
amounts registered in deferred tax assets will be recovered as for the
tax carry forward losses concerns.
Related with Inventories and third parties
Related with Tax Losses
Related with Fixed Tangible Assets / Intang. / P. Inv.
Others
Deferred Tax Assets
Related with Fixed Tangible Assets
Related with other taxable temporary differences
Deferred Tax Liabilities
Current Income Tax
Deferred Income Tax
Income Tax
2015
5,198
939
1,068
1,154
8,359
4,531
2,212
6,743
-19,423
1,927
-17,496
2014
3,981
749
1,294
684
6,708
4,806
2,164
6,970
-17,536
760
-16,776
(thousand euros)
The difference between the variation in the financial position and
the value expensed in income statement (1,927 K€) is justified by the
translation differences (27 K€ debit) in the non-euro subsidiaries
financial position values and by the variation in deferred tax related
with hedging instruments (76 K€ credit).
Six , by Ja mes Irvine for Mater ia Collect ion
125
Cork in Brazil Pavilion at the Milan Expo 2015
Following chart explains the effective income tax rate, from the original income tax rate of most
of Portuguese companies:
Income Tax Conciliation
Income Tax - Legal
Effect of additional tax rates over base rate (Portugal)
Effect of tax benefits/excess of prior estimate
Effect of provisions for contingencies
Effect of non-taxable gains and losses
Effect of different tax rates (foreign subsidiaries) and others
Effect of recognising / non-recognising of differed taxs (foreign subs.)
Effect of variation of differed tax liabilities
Income tax - effective[1]
1
Income Tax / Pre-tax Profit, Equity Gains, Non-controlling Interests, non-fiscal impairments and stamp tax provisions
During 2015, a total of 15,611 K€ (2014: 9,479 K€) of income tax was paid. Of this amount, 11,295
K€ (2014: 6,072 K€) was paid in Portugal.
Corticeira Amorim and a large group of its Portuguese subsidiaries are taxed since January
1, 2001, as a group special regime for tax purposes (RETGS), as according to article 63, of the
income tax code (CIRC). The option for this special regime is renewable every five years.
According to law, tax declarations for Corticeira Amorim and its Portuguese subsidiaries
are subject of revision and possible correction from tax authorities generally during the next
four years.
No material effects in the financial statements as of December 31, 2015, are expected by the
Board of Corticeira Amorim from the revisions of tax declarations that will be held by the tax
authorities.
Tax losses to be carried forward are related with foreign subsidiaries. Total amounts to 32 M€,
of which around 3 M€ are considered to be utilised. These losses can be fully used up to 2020
and beyond.
126
2015
2014
21.0%
5.7%
-4.2%
0.0%
1.1%
1.5%
0.2%
-1.4%
23.9%
23.0%
5.5%
-1.7%
1.0%
0.0%
1.6%
0.6%
-0.4%
29.6%
xIII
INVENTORIES
Goods
Finished and semi-finished goods
By-products
Work in progress
Raw materials
Advances
Goods impairments
Finished and semi-finished goods impairments
Raw materials impairments
Inventories
2015
2014
7,818
109,585
247
15,244
141,313
1,571
-1,036
-1,782
-1,255
271,705
8,862
95,055
291
11,540
133,239
1,059
-1,180
-965
-267
247,633
(thousand euros)
Impairment losses
Initial Balance
Increases
Decreases
Others
End Balance
2015
2014
2,413
2,179
519
0
4,073
2,253
76
177
261
2,413
(thousand euros)
Increases in impairment losses hit cost of goods sold and materials consumed in income
statement.
From the increase in impairment losses in 2015, an amount of 1,347 K€ resulted from the
revision of the estimate of the impairment of finished products in the Cork Composites BU.
Given the similarity of the goods this BU with those of the Floor and Wall Coverings BU, it is
considered that the criteria of this BU, based on aging, is the most adequate to estimate the
impairment of that BU.
Cork enhances the eco -efficiency of transportat ion
127
xIV
TRADE
RECEIVABLES
Gross amount
Impairments
Trade receivables
2015
2014
144,975
-12,429
132,546
132,384
-9,777
122,606
(thousand euros)
Impairment losses
Initial Balance
Increases
Decreases
Others
End Balance
2015
2014
9,777
3,408
511
-245
12,429
10,463
2,163
1,813
-1,036
9,777
(thousand euros)
At the end of each period, Trade receivables credit quality is analysed. Due to specific business
environment, balances unpaid up to 90 days are not impaired. From 90 to 120 days a 30%
impairment register is considered and from 120 to 180 days 60%. Over 180 days as well as all
doubtful balances are fully impaired. These rules do not overcome specific cases analysis.
Due and past due balances are as follows:
Due
Past due between 0 and 90 days
Doubtful and past due over 180 days
Impairment
2015
103
27
2
3
10
13
2014
95
25
2
2
8
10
(million euros)
Cork in the auto motive industry
128
xV
xVI
INCOME
TAX
OTHER
ASSETS
Income tax - advances / minimum / excess est.
Income tax - advances
Income tax - withholding
Income tax - special payment (RERD)
Income tax - special payment (RERD) impairment
Income tax
2015
2014
811
1,983
345
4,265
-4,265
3,139
426
1,568
239
4,265
-4,265
2,233
(thousand euros)
Advances to suppliers / suppliers
Accrued income
Deferred costs
Hedge accounting assets
VAT
Others
2015
2014
2,133
996
2,565
1,051
18,771
3,162
28,678
3,988
93
1,192
81
17,045
3,273
25,673
(thousand euros)
The amount of 4,265 K€ refers to a payment made under an exceptional
regime of regularisation of debts to the tax authority and to social
security (DL 151-A/2013) (RERD). Corticeira Amorim has decided to
partially adhere. A total of 4,265 K€ was paid in December 2014. This
payment refers to stamp tax (1,678 K€) and income tax cases (2,587
K€). The amount related with stamp tax was provisioned. As for the
income tax cases, they were already provisioned, including late payment
interest. To be noted that Corticeira Amorim was not a debtor to the
social security and to the tax authority. Those amounts were subject
to court ruling. The cases that were chosen to adhere are old cases
(1996, 1997, 1998 and 2008), but, in circumstance of unfavourable
ruling by the court, the outcome could impose heavy penalties and
late payment interests. RERD allowed for the payment of the capital
without any payment regarding late payment interests and other costs.
Due to the fact that adhesion to RERD does not imply a mandatory
abandonment of the court cases and those processes are still in court,
Corticeira Amorim will continue to fight for its rights.
As of December 31, 2015 and 2014, there were no overdue in the
amounts of VAT.
xViI
CASH AND CASH
EQUIVALENTS
2015
2014
Others
167
6,412
794
89
173
5,486
359
18
Cash and cash equivalents as
for financial position
7,461
6,036
-12,120
-11,835
-4,659
-5,799
Cash
Bank Balances
Time Deposits
Overdrafts
Cash and cash equivalents as
for cash flow statement
(thousand euros)
129
xVIIi
CAPITAL AND
RESERVES
Share C apital
As of December 31, 2015, the share capital is represented by 133,000,000
ordinary registered shares, conferring dividends, with a par value of
1 Euro.
The Board of Corticeira Amorim is authorised to raise the share capital,
one or more times, respecting the conditions of the commercial law,
up to 250,000,000 €.
Treasury stock
In mid-September 2015 Corticeira Amorim sold all of its long held
treasury stock. This operation took place in the form of a private offer
for sale of 7,399,262 shares, representing 5.56% of share capital at a
price of 4.45 euros per share. Total cash inflow was 32.9 M€. Since this
operation involves shareholders but no company control change, the
registered gain from the sale was recorded directly in equity (25.7 M€).
No sales and purchases were registered during 2014.
Dividends
In the Shareholders’ General Meeting of M arch 2 4 ,
2015 and November 13, 2015, a dividend distribution of
0.14 and 0.245 euros per share was approved.
Approved dividends
Portion attributable to own shares
Dividends paid
Summary of changes in Equity:
Initial Balance
Gain in treasury stock sale
Dividends paid
Legal reserve and share premium
Legal reserve and share premium are under the legal reserve rule and
can only be used for (art. 296 CSC):
Change in hedge accounting adjustments
Change in translation differences
×× Offset losses in the financial position that cannot be offset by
the use of other reserves;
×× Offset losses of prior year that cannot be offset by the profit
of the year nor the use of other reserves;
×× Incorporation in share capital.
Legal reserve and share premium values are originated from Corticeira
Amorim, SGPS, S.A. books.
Other reserves
Value is composed from other reserves account and prior year’s results
of Corticeira Amorim, SGPS, S.A. books, as well as non-distributed
cumulative results of Corticeira Amorim, SGPS, S.A. subsidiaries.
Individual accounts of Corticeira Amorim registered distributable
reserves as dividends, considering 2015 net profits, amounting to
59 985 K €.
130
2014
25,270
-1,406
23,864
(thousand euros)
Change in treasury stock
As of December 31, 2015, Corticeira Amorim held no treasury stock.
As of December 31, 2014, Corticeira Amorim held 7,399,262 of its own
shares, corresponding 5.563% of its share capital.
2015
51,205
-1,036
50,169
Others
Net Income
Change in Non-controlling Interests
(note XVIII)
End Balance
2015
2014
315,569
301,737
7,197
0
25,729
0
-50,169
-23,864
-124
-55
919
1,671
25
-61
55,012
35,756
-25
384
354,133
315,569
(thousand euros)
xiX
NON-CONTROLLING
INTEREST
Initial Balance
In / Out
Results
Dividends
Exchange Differences
Others
End Balance
2015
2014
13,393
13
558
-293
-303
0
13,368
13,008
-12
924
-433
-87
-7
13,393
(thousand euros)
2015
Impact on
Balance Sheet
2014
Impact on
Net Income
Dividends
paid
Impact on
Balance Sheet
Impact on
Net Income
Dividends
paid
Trefinos
Francisco Oller
Amorim Isolamentos
Industria Corchera
Timberman
Victor y Amorim
Other
1,653
1,885
1,822
5,999
564
818
627
152
176
90
27
221
158
-266
73
21
40
–
–
153
7
1,574
1,729
1,772
6,260
344
813
901
125
116
156
229
192
141
-35
209
–
–
59
–
148
17
End Balance
13,368
558
293
13,393
924
433
Summary indicators of the main subsidiaries with non-controlling interests:
Trefinos
2015
Current assets
Non-current assets
Assets
Total Equity
Sales
Operating profit
Net Income
2014
Current assets
Non-current assets
Assets
Total Equity
Sales
Operating profit
Net Income
Francisco
Oller
Amorim
Isolamentos
Industria
Corchera
Timberman
Victor y
Amorim
K€
K€
K€
K CLP
K DKK
K€
14,435
10,832
25,267
17,571
27,677
2,365
1,680
12,464
15,674
28,138
22,520
22,516
2,765
2,071
7,730
4,461
12,191
8,898
10,064
812
627
11,899,065
4,570,694
16,469,759
9,006,634
13,064,702
-117,572
-203,723
26,412
4,449
30,861
11,288
83,157
5,093
4,095
2,195
623
2,818
1,638
4,947
426
321
15,921
9,898
25,819
16,922
25,220
1,857
13,143
14,186
27,329
19,858
21,096
1,899
8,225
4,635
12,860
8,606
10,038
1,034
10,916,688
4,771,657
15,688,345
9,100,472
13,432,141
475,893
22,541
5,707
28,248
7,193
70,068
3,475
1,770
660
2,430
1,628
4,682
386
1,268
1,380
778
378,829
2,660
283
131
xx
INTEREST
BEARING DEBT
At year-end, interest bearing loans was as follows:
Overdrafts and Bank loans
Bonds
Commercial Paper
Interest-bearing loans - current
As of December 31, 2015 three foreign subsidiaries had a 4.5 million
euro loan mortgage guarantee.
2015
40,179
9,967
0
50,146
2014
42,383
0
24,985
67,369
(thousand euros)
Loans were denominated in euros, except 41% (2014: 16%).
Bank loans
Reimbursable subsidies
Bonds
Interest-bearing loans - non-current
2015
39,940
1,271
0
41,211
At the same date, Corticeira Amorim had utilized credit lines with
associated financial covenants. These included, namely, ratios accomplishment that allowed for an accompaniment of the financial
position of the company, most of all its capacity to pay its debt, of
which the most important is Debt to EBITDA ratio (net interest bearing
debt/current EBITDA). Also ratio related with balance sheet structure.
As of December 31, 2015, these ratios were as follows:
2014
5,258
1,039
19,929
26,225
(thousand euros)
At the end of 2015, loans were denominated in euros 91% (2014: 88%)
and USD 8% (2014: 12%).
Net interest bearing debt / current EBITDA (X)
Equity / Assets
0.83
53.1%
Ratios above fully and easily accomplished the demands of the contracts
that formalized said loans. If by chance they did not accomplish the
possibility of an early payment was conceivable.
On top of the said full accomplishment, it has to be noted that the
capacity of full repayment was reinforced by the existence, as of that
date, of non-used credit lines that amounted to 131 M€.
As of December 31, 2015, maturity of non-current interest bearing
debt was as follows:
Between 01/01/2017 and 31/12/2017
Between 01/01/2018 and 31/12/2018
Between 01/01/2019 and 31/12/2019
After 01/01/2020
Total
1,916
152
5,764
33,379
41,211
xxI
SUPPLIERS
(thousand euros)
From non-current and current interest bearing debt, 66,357 K€ carries
floating interest rates. Remaining 25,000 K€ carries fixed interest
rate. Average cost, during 2015, for all the credit utilized was 2.05%
(2014: 3.73%).
Note that at the end of the first quarter Corticeira Amorim effected
a loan agreement with the EIB. This ten year loan, in the amount of 35
M€, with a grace period of four years, was negotiated at an all-in cost
lower than any existing loan to date. With this financing Corticeira
Amorim could substantially lengthen the terms of its debt and, at same
time, lowering considerably average rate of interest-bearing debt.
During first quarter 2013, a three year interest rate swap with a notional
of 20,000 K€ was contracted. With the contract, Corticeira Amorim
pays interest at a fixed rate and in exchange receives interest at a
variable rate, according to Euribor 6 month.
As of December 2015, Corticeira Amorim had credit lines with
contractual clauses that include covenants generally used in these
type of contracts, namely: cross-default, pari-passu and in some
cases negative pledge.
132
Suppliers - current account
Suppliers - confirming
Suppliers - accrualls
Suppliers
2015
2014
53,502
62,036
5,646
121,184
53,479
57,377
4,447
115,303
(thousand euros)
From the total values, 49% comes from Cork Stoppers BU (2014: 54%)
and 25% from Raw Materials BU (2014: 24%).
xxII
OTHER LOANS
AND CREDITORS
2015
2014
Non interest bearing grants
8,794
10,831
Other
1,221
702
10,015
11,533
3,381
1,442
Other loans and creditors - non current
Non interest bearing grants
21,815
18,646
Deferred income - grants
5,148
6,130
Deferred income - others
110
173
Deferred costs
VAT
7,136
5,879
State and social security - withholding
and others
6,214
5,023
Other
5,714
6,713
49,518
44,006
Other loans and creditors - current
(thousand euros)
In Deferred costs the part related with salaries (vacations) at year-end
amounted to 10,851 K€ (2014: 9,857 K€).
In 5,714 K€ (2014: 6,713 K€) is included a value of 449 K€ (2014: 2,589
K€), which refers to the fair value of exchange risk and interest rate
risk derivatives. In the remaining value, a total of 676 K€ (2014: 658
K€) refers to salaries to be paid.
In Other loans and creditors – non-current (10,015 K€), maturity is
as follows: 2017 (3,538 K€), 2018 (2,913 K€), 2019 (3,374 K€) and 2020
and further (191 K€).
Non-reimbursable subsidies
(no interest bearing)
2015
2014
Opening Balance
6,130
6,395
Transfer to gains
-1,473
-2,272
Received during the year
345
0
Reclassifications / Transfers
146
2,006
5,148
6,130
2015
2014
Opening Balance
13,435
12,305
Paid during the year
-2,229
-1,009
1,750
3,921
-781
-1,781
Closing Balance
Reimbursable subsidies
(no interest bearing)
Received during the year
Reclassifications / Transfers
Closing Balance
12,175
13,435
(thousand euros)
“Transfers” is due largely to reimbursable benefits that were in the
meantime, in some subsidiaries, converted into non-reimbursable and
to the recognition of interest through measurement at amortized cost.
Helix
133
xxiiI
xxV
TAX
LIABILITIES
STAFF
COSTS
Includes income tax estimate to be paid by some subsidiaries, when
2015, tax declaration is presented.
xxIV
THIRD PARTY
SUPPLIES AND
SERVICES
Subcontractors
Special Services
Advertising
Security
Professional Fees
Commissions
Maintenance
Tools
Power
Oil and gas
Travel
Transports
Rentals
Communications
Insurance
Representation expenses
Data systems
Others
Capitalized Costs
Third party supplies and services
Board remuneration
Employees remuneration
Social Security and other
Severance costs
Other
Capitalized costs
Staff costs
Average number of employees
Final number of employees
2015
644
85,575
16,968
3,386
5,462
-154
111,881
3,636
3,537
2014
552
79,242
16,452
2,018
5,051
0
103,315
3,497
3,468
(thousand euros)
Board’s remuneration includes Corticeira Amorim, SGPS, SA and any of
its subsidiaries. Includes also Fiscal Board and General Meeting board
members expenses. Amounts stated in this chart derive from the
company’s books, and so refers to amounts expensed during the period.
2015
2,825
9,526
6,897
1,028
987
6,900
8,193
1,545
11,917
1,660
4,128
22,381
4,815
1,221
3,175
897
4,195
8,706
-459
100,538
2014
3,964
7,426
5,862
1,101
864
6,018
8,836
1,551
11,387
1,624
3,991
21,539
5,043
1,146
3,262
816
4,495
7,504
0
96,429
Contributions related with defined contributions plans amounted to
214 K€ (2014: 404 K€).
(thousand euros)
Pino, by Daniel C ara melo for Mater ia collect ion
134
xxVI
xxViI
IMPAIRMENTS
OF ASSETS AND
NON-CURRENT
COSTS
OTHER
OPERATING
GAINS AND
COSTS
2015
2014
Gain in fixed assets and
p. investment disposals
129
402
-177
Provisions reversals
132
1,071
-106
-34
Operating subsidies
877
895
281
0
1,473
2,272
3,291
149
Suplementary income
1,784
1,904
Building rentals
144
446
Own works
329
170
17
0
Other
4,049
2,453
Other operating gains
8,934
9,613
2015
2014
Receivables
3,117
359
Inventories
0
Tangible assets
Others
Impairments of assets and non-current costs
(thousand euros)
Receivables include customers and debtors.
Gain in inventory differences
2015
2014
2,904
2,503
Corroios production transfer costs
0
371
Real estate impairment (Corroios)
0
1,224
Compensation
0
2,256
2,904
6,354
Goodwill impairment (A. Deutschland)
Non-current costs
(thousand euros)
In 1H2015, goodwill impairment was recorded as described in Note X.
As described in Note X, during 2014 an impairment of 1,224 K€ on Corroios
land and buildings was recorded. Also in the year 2014, was recorded
the write-off of the goodwill associated with Amorim Deutschland
(2,503 K€), as described in Note X. The amount of compensation in 2014
refers to restructuring related to Corroios (Amorim Cork Composites)
and Spain (Agglotap and Augusta Cork).
(thousand euros)
2015
2014
Exchange rate hedging:
exchange differences
5,537
-1,956
Exchange rate hedging:
var. derivative fair value
-2,886
3,145
1,364
1,462
Provisions
393
74
Loss in fixed assets and
p. investment disposals
241
68
Bank charges
428
430
Bad debts
282
343
88
207
480
415
Other
2,189
2,395
Other operating costs
8,117
6,581
Taxes (other than income)
Loss in inventory differences
Donations and fees
(thousand euros)
135
xxVIiI
xxiX
FINANCIAL COSTS
AND FINANCIAL
INCOME
RELATED-PARTY
TRANSACTIONS
2015
2014
1,461
2,853
Interest costs - other entities
678
1,225
Stamp tax
315
2,182
Interest costs - other
393
-224
2,847
6,036
Interest gains - bank deposits
33
39
Interest gains - delayed payments
16
53
Interest gains - other
10
88
Financial income
58
180
Interest costs - bank loans
Financial costs
Corticeira Amorim consolidates indirectly in INTERFAMILIA II, S.G.P.S.,
S.A. with head-office at Mozelos (Santa Maria da Feira, Portugal),
Amorim Group holding company, which holds 100% of AMORIM INVESTIMENTOS E PARTICIPAÇÕES, S.G.P.S., S.A. (AIP).
As of December 31, 2015 and 2014, financial stake of Amorim Group
in Corticeira Amorim was 51% of its share capital. As of December
31, 2014, that stake corresponded to 54.004% of the voting rights.
Corticeira Amorim related party transactions are, in general, due to
the rendering of services through some of AIP subsidiaries (Amorim
Serviços e Gestão, S.A., Amorim Viagens e Turismo, S.A., OSI – Sistemas
Informáticos e Electrotécnicos, Lda.). Total sales of these subsidiaries
to the remaining Corticeira Amorim companies totalled 7,627 K€
(2014: 7,270 K€).
Sales from Quinta Nova, S.A., AMORIM - INVESTIMENTOS E PARTICIPAÇÕES, S.G.P.S., S.A. subsidiary to Corticeira Amorim subsidiaries
reached 23 K€ (2014: 42 K€). Purchases totalled 80 K€.
Stamp tax value includes a provision of 212 K€ (2015) and 1,990 K€
(2014), as stated in Note XXX.
Cork acquired during 2015, from companies held by the main indirect
shareholders of Corticeira Amorim, amounted to 1,317 K€ (2014:
2,490 K€). This corresponds to less than 2% of total acquisitions of
that cork raw-material.
Interest costs – other entities includes 214 K€ (2014: 694 K€) due to
interest rate swap differential, as well as 388 K€ (2014: 506 K€) related
with interest discount deriving from non-interest bearing loans.
Balances at year-end 2015 and 2014 are those resulting from the
usual payment terms (from 30 to 60 days) and so are considered to
be immaterial.
In 2014, the value of -224 K€ includes the gain coming from the
variation in the swap Fair Value (557 K€), as well as costs related with
loans commissions and others.
All transactions with related-parties are based on market prices. When
a transaction cannot use that policy, it is used the “cost plus” basis
ranging from 2% to 5%.
As for 2015, the value of 393 K€ includes the gain coming from the
variation in the swap Fair Value (195 K€), as well as costs related
with loans commissions and others, as well as costs related with the
treasury stock sale.
During 2015 no transactions were made and no balances booked with
related parties Amorim Capital, SGPS, SA, Amorim Investimentos e
Participações, SGPS, SA and Interfamília II, SGPS, SA.
(thousand euros)
Total Corticeira Amorim key staff short-term remuneration reached
2,279 K€ during 2015 (2014: 1,656 K€). No payments were made related
with post-employment benefits, other long-term benefits, termination
benefits and equity compensation benefits.
136
Note that during the year there were no developments worthy of note
in the processes mentioned above.
xxX
The value of tax processes to date for the 2015 accounts amounted to
17.1 M€, for which 15.1 M€ of provisions were recognized, corresponding
to 88% of that amount. For cases for which provisions were recorded,
an estimated value of 2.2 M€ of default interest was recorded.
Provisions,
Guarantees
Contingencies
and Commitments
In addition to the tax provisions referred to above, Corticeira Amorim
has recorded a provision to cover the tax benefits to apply for 2015 and
applied in previous years. The certification requirement of expenses
eligible in SIFIDE projects, the requirement for maintenance of jobs over
five years in RFAI projects as well as other constraints to the realization
of benefits, has led Corticeira Amorim to record provisions in order to
take account of future and probable breaches of such requirements.
This provision amounted in late 2015 to 9.9 M€.
Provisions
Income tax
Guarantees to customers
Others
Provisions
2015
2014
29,896
25,617
364
727
1,967
1,607
32,227
27,951
(thousand euros)
During 2015 a total 4.3 M€ of provisions related with income tax was
recorded. That total refers to tax contingencies. The remaining two
types of provisions had variations that cancelled each other.
With regard to provisions for tax benefits, they reported in 2015 a net
increase of 3.6 M€. Additionally were also recognized provisions of 0.7
M€ to address situations where there are doubts about the acceptance
by tax authorities of the existence of tax losses. This occurs in two
Spanish subsidiaries.
During the year were reversed provisions for taxes, namely income tax,
in the amount of 0.7 M€. A 0.6 M€ provision was registered in order
to reinforce interest due related with tax processes.
Tax cases are in general related with Portuguese companies. Live
processes, in judicial phase as in graceful stage, which can affect
adversely Corticeira Amorim, correspond to fiscal years of 1997, 1998,
1999, and from 2003 to 2014. The most recent fiscal year analysed by
Portuguese tax authorities was 2013. It should be noted, however, that
the approval of the tax benefits cannot be considered as complete,
since their obligations continue for several years.
These tax cases are basically related with questions like non-remunerated
guarantees given between group companies, group loans (stamp tax),
interest costs of holding companies (SGPS), and with the acceptance
as fiscal costs of losses related with the closing of subsidiaries.
Claims by the tax authorities are related with income tax, stamp tax
and marginally VAT.
Income tax provisions refer to live tax cases, in court or not, as well
as accounting recorded situations that can raise questions in future
inspections by the tax authority.
At the end of each year, an analysis of the tax cases is made. The
procedural development of each case is important to decide new
provisions, or reverse or reinforce existing provisions. Provisions
correspond to situations that, for its procedural development or for
doctrine and jurisprudence newly issued, indicate a probability of an
unfavourable outcome for Corticeira Amorim and, if that happens,
a cash outflow can be reasonably estimated.
To note that, Corticeira Amorim has been set aside provisions due to
uncertainty about the acceptance by tax authorities of the existence
of tax losses in two Spanish subsidiaries. The provision at the end of
2015 was 2.3 M€.
Total contingent liability resulting from not accrued tax proceedings
and other contingencies unrecorded liabilities, amounts to 4.4 M €.
In addition to these processes, Corticeira Amorim has a large
number of other favourable processes. They refer, in essence, to
payments related with autonomous taxation, inspection fees and
tax benefits. The value of these processes mounts to 0.8 M€, which
is not registered as assets. In addition to Corticeira Amorim made
in 2013 payments for taxes and social security in the amount of 4.6
M€, of which the most important is for payment established by
Decree Law 151-A / 2013 (RERD) worth 4.3 M€. This payment does not
imply the abandonment of Corticeira Amorim of the defence of its
own interest in these processes. Total contingent assets amounts
to 5.4 M€.
It is considered correct the total value of 29.9 M€ of provisions related
with contingencies regarding income tax and 2.3 M€ regarding other
contingencies.
Guarantees
During its operating activities Corticeira Amorim issued in favour of
third-parties guarantees amounting to 113,501 K€ (2014: 66,030 K€).
Beneficiary
Amount
Purpose
Government agencies
5,123
Capex grants / subsidies
Tax authority
2,971
Tax lawsuits
Banks
105,320
Credit lines
Other
86
Miscellaneous guarantees
TOTAL
113,501
(thousand euros)
As of December 31, 2015, future expenditure resulting from long-term motor vehicle rentals totals 1,552 K€, and for computer hardware and software
totals 363 K€. Total is due 2016 (273 K€), 2017 (311 K€), 2018 (511 K€),
2019 (749 K€) and 2020 and further (71 K€).
Commitments related with fixed assets totalled 2,985 K€, all expected
to be materialized during 2016. Cork purchase commitments amount
to 17,187 K€ (2016: 13,456 K€; 2017: 1,802 K€ and 2018: 1,929 K€).
137
Towada Com munity Center , Japão, de Kengo Kum a
138
xxXI
xxXiI
EXCHANGE
RATE CONTRACTS
AUDITOR’S
FEES
As of December 31, 2015, forward outright and options contracts
related with sales currencies were as follows:
2015
2014
USD
43,307
95%
13,186
79%
ZAR
2,027
4%
2,812
17%
HUF
161
0%
115
1%
GBP
0
0%
571
3%
45,495
100%
16,684
100%
4,503
100%
1,595
100%
4,503
100%
1,595
100%
26,321
100%
22,899
100%
26,321
100%
22,899
100%
6,900
100%
0
–
6,900
100%
0
–
Forward - long
positions
USD
Forward - short
positions
USD
Options - long
positions
USD
Options - short
positions
PricewaterhouseCoopers auditor’s remuneration for the group of
subsidiaries and for Corticeira Amorim was 442 K€ (2014: 400 K€).
xxXIiI
ACTIVITY DURING
THE YEAR
Corticeira Amorim sales are composed by a wide range of products
that are sold through all the five continents, over 100 countries. Due
to this notorious variety of products and markets, it is not considered
that this activity is concentrated in any special period of the year.
Traditionally first half, specially the second quarter, has been the best
in sales; third and fourth quarter switch as the weakest one.
(thousand euros)
It is expected that hedged highly probable transactions in foreign
currencies occur during the first half of 2016. The corresponded value
recognised in equity as hedge accounting will be recorded in income
statement in that same period.
The amount recognised in comprehensive income statement as “change
in derivative financial instruments fair value” reached -124 thousand
euros (2014: -55 thousand euros).
In relation with fair value hedging, during 2015 a gain of 2,887 thousand
euros was recorded in the hedging instruments (2014: loss of 3,145
thousand euros) and a loss of 5,174 thousand euros was recorded in the
hedged items (2014: gain of 2,646 thousand euros). As of December
31, 2015, notional for long positions reached 24.3 million euros and
notional for short positions reached 5.2 million euros regarding fair
value hedging.
No gains or losses were recorded regarding hedge inefficiency.
139
xxXIV
OTHER
INFORMATION
a. Net profit per share calculation used the average number of issued shares deducted
by the number of average owned shares. The non-existence of potential voting
rights justifies the same net profit per share for basic and diluted.
Total issued shares
Average nr. of treasury shares
2015
2014
133,000,000
133,000,000
5,290,979
7,398,429
127,709,021
125,601,571
Net Profit (thousand euros)
55,012
35,756
Net Profit per share (euros)
0.431
0.209
Average nr. of outstanding shares
b. IFRS disclosures - New standards as at 31 December 2015:
1. The impact of the adoption of the standards and interpretations that became effective
as of 1 January 2015 is as follows:
Standards
a.Annual Improvements 2011 - 2013. The 2011-2013 annual improvements affects: IFRS
1, IFRS 3, IFRS 13 and IAS 40. The adoption of these improvements had no impact on
the consolidated financial statements of the entity.
Interpretations
a.IFRIC 21 (new), ‘Levies’. Interpretation to IAS 37 and the recognition of a liability,
clarifying that the obligation event that gives rise to a liability to pay a levy is the
activity described in the relevant legislation that triggers the payment. The adoption
of this interpretation had no impact on consolidated financial statements of the entity.
2. The following standards and amendments to existing standards have been
published and are mandatory for the accounting periods beginning on or after 1
February 2015, but that the Corticeira Amorim has not early adopted:
Standards
a.Annual Improvements 2010 - 2012, (generally effective for annual periods beginning
on or after 1 February 2015). The 2010-2012 annual improvements affects: IFRS 2, IFRS
3, IFRS 8, IFRS 13, IAS 16 and 38, and IAS 24. No significant impacts are expected of the
future adoption of these improvements on the consolidated financial statements of
the entity.
b.IAS 19 (amendment), ‘Defined benefit plans – Employee contributions’ (effective
for annual periods beginning on or after 1 February 2015). This amendment applies
to contributions from employees or third parties to defined benefit plans and aims
to simplify the accounting when contributions are not associated to the number of
years of service. No impacts are expected of the future adoption of this amendment
on the consolidated financial statements of the entity.
c.IAS 1 (amendment), ‘Disclosure initiative’ (effective for annual periods beginning
on or after 1 January 2016). This amendment provides guidance on materiality and
aggregation, the presentation of subtotals, the structure of financial statements,
the disclosure of accounting policies and OCI items presentation when arising from
investments measured at equity method. No significant impacts are expected of the
future adoption of these improvements on the consolidated financial statements of
the entity.
140
d.IAS 16 and IAS 38 (amendment), ‘Acceptable methods of depreciation and amortisation calculation’ (effective for annual periods beginning on or after 1 January 2016).
This amendment clarifies that the use of revenue-based methods to calculate the
depreciation / amortization of an asset is generally presumed to be an inappropriate
basis for measuring the consumption of the economic benefits embodied in an asset.
It shall be applied prospectively. No impacts are expected of the future adoption of
this amendment on the consolidated financial statements of the entity.
e.IAS 16 and IAS 41 (amendment), ‘Agriculture: bearer plants’ (effective for annual
periods beginning on or after 1 January 2016). This amendment defines the concept of
a bearer plant and removes it from the scope of IAS 41 – Agriculture, to the scope of IAS
16 – Property, plant and equipment, with the consequential impact on measurement.
However, the produce growing on bearer plants will remain within the scope of IAS
41 - Agriculture. No impacts are expected of the future adoption of this amendment
f. IAS 27 (amendment), ‘Equity method in separate financial statements’ (effective for
annual periods beginning on or after 1 January 2016). This amendment allows entities
to use equity method to measure investments in subsidiaries, joint ventures and
associates in separate financial statements. This amendment applies retrospectively.
The future adoption of this amendement will have no impact on the consolidated
financial statements of the entity.
g.Amendment to IFRS 10, 12 and IAS 28, ‘Investment entities: applying consolidation
exception’’ (effective for annual periods beginning on or after 1 January 2016). This
amendment is still subject to endorsement by the European Union. This amendment
clarifies that the exemption from the obligation to prepare consolidated financial
statements by investment entities applies to an intermediate parent which is a subsidiary
of an investment entity. The policy choice to apply the equity method, under IAS 28,
is extended to an entity which is not an investment entity, but has an interest in an
associate, or joint venture, which is an investment entity. The future adoption of this
amendement will have no impact on the consolidated financial statements of the
entity, because it is not an investment entity.
h.IFRS 11 (amendment), ‘Accounting for the acquisition of interests in joint operations
(effective for annual periods beginning on or after 1 January 2016). This amendment
adds new guidance on how to account for the acquisition of an interest in a joint
operation that constitutes a business, through the application of IFRS 3’s principles.
No significant impacts are expected of the future adoption of these improvements
i. Annual Improvements 2012 - 2014, (effective for annual periods beginning on or
after 1 January 2016). The 2012-2014 annual improvements affects: IFRS 5, IFRS 7, IAS
19 and IAS 34. No significant impacts are expected of the future adoption of these
improvements on the consolidated financial statements of the entity.
j. IFRS 9 (new), ‘Financial instruments’ (effective for annual periods beginning on or after
1 January 2018). This standard is still subject to endorsement by the European Union.
IFRS 9 replaces the guidance in IAS 39, regarding: (i) the classification and measurement
of financial assets and liabilities; (ii) the recognition of credit impairment (through
the expected credit losses model); and (iii) the hedge accounting requirements and
recognition. No significant impacts are expected of the future adoption of these
improvements on the consolidated financial statements of the entity.
k.IFRS 15 (new), ‘Revenue from contracts with customers’ (effective for annual periods
beginning on or after 1 January 2018). This standard is still subject to endorsement
by European Union. This new standard, applies only to contracts with customers to
provide goods or services, and requires an entity to recognise revenue when the
contractual obligation to deliver the goods or services is satisfied and by the amount
that reflects the consideration the entity is expected to be entitled to, following a five
step approach. No impacts are expected of the future adoption of this amendment
141
c. Financial Assets and Liabilities
Financial Assets are mainly registered in the Loans and Other Receivables caption. As for
Financial Liabilities they are included in the Amortized Liabilities caption.
Detail is as follows:
Trade receivables
Trade receivables
Loans and
receivables
Fair value
through profit
or loss
Derivatives as
hedging
Available
for sale assets
Total
122,606
24,400
6,036
153,042
132,545
24,919
7,461
164,925
–
–
–
0
–
398
–
398
–
81
–
81
–
652
–
652
–
3,631
–
3,631
–
4,177
–
4,177
122,606
28,112
6,036
156,754
132,545
30,146
7,461
170,153
(thousand euros)
Fair value
through profit
or loss
Derivatives as
hedging
Other financial
liabilities at
amortized cost
Total
–
207
–
207
–
-64
–
-64
–
2,382
–
2,382
–
514
–
514
93,594
46,648
115,303
255,545
91,357
53,825
121,184
266,366
93,594
49,237
115,303
258,134
91,357
54,275
121,184
266,816
Trade payables
Trade payables
(thousand euros)
Customers balances are denominated in USD (8.2%), CLP (5.8%), ZAR (1.4%), AUD (1.1%), being
the remaining almost totally euro based. As business in Argentina started to be conducted
by associate Corchos Argentina, customer’s balances in Argentinian pesos (ARS) no longer
exist. Exchange differences are due, mainly, to non-euro based customer’s balances, as well
as foreign currency loans used as a hedge accounting instrument.
Mozelos, February 11, 2016
The Board of Corticeira Amorim, S.G.P.S., S.A
Chairman
Vice-President
Member
Member
Member
Juan Ginesta Viñas
Member
142
CICIA’s faç ade covered with expanded insulat ion corkboard
143
06
Legal
Opinion
146
— ANNUAL REP ORT AND ACCOUNTS ‘15 CORTiCEiR A A mORim , S.g.P.S., S. a .
LEG AL OP INION —
147
148
LEG AL OP INION —
149
TITLE
Annual Report and Accounts 2015 – CORTICEIRA AMORIM, S.G.P.S., S.A.
PROPERT Y AND CO ORDINATION
CORTICEIRA AMORIM, S.G.P.S., S.A. – Sociedade Aberta
Edifício Amorim I
Rua de Meladas, n.o 380
Apartado 20 4536-902
MOZELOS – PORTUGAL
T: +351 227 475 400
F: +351 227 475 410
corticeira.amorim@amorim.com
www.corticeiraamorim.com
GRAPHIC DE SIGN
Bolos Quentes Design
www.bolosquentes.com
PHOTO CREDIT s
Cover:
Apcor
António Rios de Amorim:
Anabela Trindade, Revista de Vinhos
Collaborative Innovation and Applied Research Centre:
Pedro Sadio
CAPC - Musée d’Art Contemporain de Bordeaux:
F. Deval
Materia Collection:
Luís Silva Campos
You Make the Park furniture:
Marco Furio Magliani 2015 FABRICA
ViniPortugal:
Pedro Sadio
Metamorphosis Project:
Pedro Sadio
Mercedes F700:
©Mercedes-Benz
London Fashion Week:
Nian Canard for Neon Squared Studios
Pages 49, 72, 78, 104, 105, 109:
Apcor
150

Consolidated Accounts

Transcription

Similar documents

expanded insulation corkboard

Nature at your feet

Diagnosis of occupation at itapemirim river marginal areas

Untitled - Amorim Cork Composites

CORECORK applications guide and case studies

Why did Cap n` Cork sWitCh to a family